Should you Rent or Buy? After a divorce, your financials take a huge hit. There are many movements of money, and money may be tied to a home, emotions, and more.
So what do you do? My first move was to rent due to the housing market being a hot mess at the time of my divorce; plus, I also needed to figure out how to find a place in a neighborhood I strived to live in and needed space for all my children.
It was my best bet due to not having extra income to deal with repairs if needed; I knew that rental insurance and the landlords would need to take care of that. I rented for two years before buying my first home on my own. My rent was much higher than a house payment, but I didn’t have to worry about certain aspects of being a homeowner. I was excited and scared but more thrilled than anything else. A home to continue raising my children in, I got my house off the crazy market, which shocked me. Then my mortgage is lower than my rent.
The point being you should consider the advantages of your home after a divorce as – getting your emotional state settled, clearing your head, and do not make swift moves. Ultimately you must do what is best for you and your family. Though I bought a home eventually, I have found the advantages and disadvantages are something I thought I would share after a recent sewer backup episode (that confirmed my biggest fear) of being a homeowner.
When renting: · Upfront Costs are precise – rent stays the same · Rental Agreements cover all repairs for the most part · What is your income now? · Will your income increase so you can save for a home? · In addition to the rental agreement, Renter's Insurance is super critical, so if you rent, please consider this. · Did you know that 36% of Americans live in rentals? You are not alone. (source: hello divorce) · Renting doesn’t provide equity. · Remember renting is not a permanent solution; however, it may be best now. · It gives you more time to find a house, condo, or apartment you may purchase long-term. When buying a home: · It’s yours, and you can do whatever you want with it. · You are building equity. · Any repairs are on you – like a sewer repair or appliances flaking out. · You can get a one-year – home warranty to possibly cover the costs of appliances going out or other home repairs (Warning: I used one that didn’t cover much – so this was a waste for me) · Any upgrades increase your house value and more money in the future should you move again. · Remember, even if you buy, if things change in your life, it’s OK to consider other options again. · Tax deductions are available in a home. · Homeowners' insurance policies differ, so look closely at all your options or look for an insurance agent that can help get you the best coverage for the best price.
Again, there are pros and cons to renting and buying. However, you will have so much on your mind during the divorce process; you must do what is best for you in the short term. Onward and upward, my friends.