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Should the Mortgage Crisis Make You a Renter Instead?

Lately we have been deemed to be in a mortgage crisis. This means that there were a lot of people who made bad really bad decision on mortgages. They did not pay attention to what they were doing. Also, there were some bad lenders who encouraged this and did not stop people from entering bad situations. Well, how will this affect you? You definitely do not want to get caught up in it. Should this situation actually turn you into a renter instead of a buyer? This is something that many people have thought about given the current situation. We have lined out some positives and negatives of renting. Hopefully this will help you.

Positives of Renting

One of the good things about renting is that you are not locked into a long term commitment. You do not have to worry about the mortgage, you are just paying month to month to live there. If you are renting then you might see that the landlord will pay to fix all the problems that happen within the home. This also leaves you without some financial responsibility. If you fear the long term commitment then you might find that renting is the best thing for you. Plus, when your time is up you can just move on to another home if you do not want to stay in the home you currently are in. Hopefully you will find that you have a good experience if you choose to go the renting route for your living.

Negatives of Renting

When you are renting you do not actually own this valuable asset. A home can help you when it grows in value because you will also be building equity. As a renter you are not entitled to the equity in the home and you will not see any benefit when the home rises in value. You are also just giving away your money to the landlord. You will not see any return on this money other then the ability to live in your home. Some people just think that it is a waste of time and money to rent. They would rather see some return on an investment. You do not ever want to put yourself in a negative renting situation. Watch out for it.

Always Act in a Positive Way for Yourself

In the end you need to do what is best for you. If you choose to rent then you need to make sure you are renting smart and you are setting yourself up with a good situation for you and your family. If you decide that you do not want to rent and that you go buy then you need to pay attention. Do not get in over your head and make sure the lender is solid. You can escape this mortgage crisis if you pay attention and do what is right for you. This may come through renting, and it may come through buying. Either way you need to always act in a positive way with your finances.
National Rate Averages

Mortgage Rates

Product Rate
5/1 yr ARM 3.147%
1 yr ARM 3.299%
15 yr fixed 3.221%
30 yr fixed 3.815%

Home Equity Rates

* Updated Jun 7, 2012