When it’s time to purchase a home, most people will already decide on applying for a mortgage.
Some people may want to purchase a house with cash and you might wonder why anyone would choose a loan over purchasing with cash. Having cash on hand can be helpful in emergencies or for other situations.
Also, having funds available to make investments means you can grow your money faster. If a home can be purchased with a mortgage, it might be a better idea for you to save your cash.
The Benefits of a Mortgage
Being able to purchase a home with cash does not mean you should. There are many benefits to having a mortgage. And if you don’t have the cash, a mortgage is the perfect solution to buying a home.
You can borrow money to make an equitable purchase.
1. You Can Purchase a Home Without Cash
Many people don’t have the cash reserves to purchase a home. Depending on the area, family size, and various other factors, it may not be possible for someone to buy a home outright.
A mortgage is a great option to purchase a home. You’re able to make monthly payments while the value of the home increases. This allows you to build equity and make a profit on your home.
2. Keep Your Cash Reserves
It may serve your financial situation better to have cash on hand. If you have any unexpected purchases or financial issues arise, you will likely be more comfortable having the money in the bank rather than in your real estate.
It’s always a good idea to have an emergency fund available. If disaster strikes and your home is destroyed, you could be waiting a while for an insurance check. Having immediate funds means you can relocate immediately and seek reimbursement from insurance later.
3. The Interest is Tax Deductible
When you have a mortgage, you’re paying interest on it. Every year when you file your taxes, if you itemize, your interest is included in your deductions.
By deducting your interest, you’re actually earning money on your mortgage over the long run.
The Right Choice for You
Buying real estate is a big purchase and a big decision. Take time to consider your options. Educate yourself about the market, home purchase requirements, and the overall process so you know what to expect.
At A1 mortgage, we want to help you understand all of the benefits having a mortgage offers. If you’re buying a home in the Kansas City, Missouri area, we’d be honored to help you with your purchase.
Contact A1 Mortgage today and we will make your dreams a reality.