At a certain point in our lives, we all dream of owning our own homes. Renting or living with your family can be hectic. Both cash and mortgage have their advantages and disadvantages. Deciding whether to use cash or mortgage can be difficult especially if it is your first time purchasing a home. Making a comparison will help you know what is best for you and pave your way towards purchasing the hose of your dreams.
There are many reasons use should pay up-front when purchasing your new home. Real estate agents are pleased when you pay for a house in cash. You are more likely to get a discount when you do this. Buyers paying cash have the leverage to haggle for a discount of the property.
Security with Cash
Paying with cash provides you with a sense of security. You do not have to deal with the aftermath of taking a mortgage. You can relax knowing you won’t have to settle any debts with the bank. Paying up-front means there are no monthly payments for you and you won’t have to pay high-interest rates when the market fluctuates.
Won’t have to worry
You won’t have to worry about losing your home to the agency due to late or no payments of the loan. When you take a mortgage, you only own part of the house until you complete the payment, if not, the agency will action everything you won including the house to get back their money.
Ownership with Cash
When you pay cash front, you acquire 100% ownership by getting a title deed. This means you are free to make decisions on the house on your own. When you need money, you can sell your house without getting the agency involved. You can use your title deed to acquire quick loans in the banks and other lending services.
Paying all that money upfront may leave you broke for a while. You may save up cash thinking you will have emergency funds left and end up using all your money in one go. It may not be easy to access the money tied to your property when you want to use it.
Are their benefits of using cash?
When you get a mortgage, you have the option of using it to invest in other ventures that may help you in paying off the loan and add some profit to your account at the same time. With paying upfront there are no added benefits. When you pay, that is it; you won’t have any extra money left.
When you pay cash, your Real estate agent will not guarantee a rise in the value of your home. There is no assurance whether or when you can make profits off your property. This means you are taking a risk by paying for your house in upfront cash and it may not guarantee an increased value.
By paying cash for your new home, you could be missing out on investment opportunities. A home is valuable and can be an investment. When making a choice, weigh between paying cash and mortgage and consider both aspects before making a decision.
Simple Personal Loans UK was kind enough to supply this article. They are a personal loan lender and broker based in the UK that prides itself in responsible lending.
Next Post: Why your offer to buy a house was rejected – Read here.