It is a good investment to buy a home. You can expect a good return in the long run. Sometimes, the price of the home is not within reach for many people. Mortgage provides an opportunity for these people to buy a home. Here are the main reasons to buy home with a mortgage.
It makes buying home affordable
Buying home is one of the major purchases you will make in your life. If you take a mortgage, you won’t need to pay the whole amount upfront. You can spread the amount over a long period. This will decrease your financial burden. Usually, you have to pay off the money between 25 to 30 years. This makes buying a home much affordable according to Tallahasee realtor Suzanne McGhee.
It is a cost-effective method of borrowing money
The interest rates on mortgages are lower than other types of loans. So, a mortgage is a better option. By getting a mortgage, the bank has the security that if in case, you cannot pay off the mortgage, the bank will be able to sell the house to get back the money.
If you purchase a property with cash, you have to pay tax. But in the case of a mortgage, the interest payments are tax deductible. So, the obligation to pay tax is less when you buy home with a mortgage.
If you don’t have a mortgage, you may not be eligible for a homestead exemption in case you fall into serious debt in future. In most states, people get protection from creditors in case of their house.
Considering all these factors, it’s obvious that buying a house with a mortgage is better than buying it with cash. So, instead of spending your cash on buying a house, you can make some other investments.