Advantages of mortgaging over renting
Owning a house is the dream of everyone. However, most people are in a dilemma on which is better: mortgage or rent? There are several merits and demerits of mortgaging or renting a house. Prospective homeowners should thoroughly research on which option fits their lifestyles and financial choices available to them.
One significant advantage of mortgaging a house is that there are no regular payments to be made to the owner. Mortgage payments are a way of building upon economic equity which could be used to secure loans from financial institutions. In monetary terms, paying for a mortgage is a form of investment as compared to paying rent which does not translate to economic equity (Luu et al., 2017).
Mortgaging a house makes one a home owner which comes with the right to choose the kind of home, the type of furniture and the color of the house. In comparison, renting does not give you the freedom to select the sort of house or its features. Owning a home comes with the assurance of ownership unlike renting where the owners may ask you to leave before your contract is over (Pocheptsova et al., 2016).
Owning a home is a great convenience in regards to having pets. People who have cats or dogs find it more difficult to find houses where pets are allowed (Tabner, 2016). Mortgaging a home gives the occupants the freedom to choose the type and number of pets they would like to own.
Mortgaging a house is more beneficial than renting one in many ways. It is a way of securing a home and investing at the same time. Homeowners have more rights than tenants, and they get to choose intricate details about the house as compared to renting where the occupant’s options are limited.
References
Luu, L., Lowe, J., Byrne, T., & Butler, J. (2017). Essential Personal Finance: A Practical Guide for Students. Taylor & Francis.
Pocheptsova, A., Kivetz, R., & Dhar, R. (2016). Acquisition Mode Effect on Consumer Product Evaluation and Tradeoff Making. ACR North American Advances.
Tabner, T. I. (2016). Renting versus buying. International Review of Financial Analysis, 48, 233-246.