Chapter 3:
Benefits of Home Ownership

Before we get into the specifics of using Bargain Network's foreclosure listings to find a bargain property, let's spend just a moment discussing the benefits of owning - versus renting - your home. Broadly speaking, there are five key advantages to home ownership today:

1. There can be significant tax advantages.
   You can normally deduct the entire amount of your mortgage interest from federal income taxes. In most states, you can deduct this amount from state taxes, also. When you realize that interest makes up nearly all of your monthly payment for the first half of your mortgage term (normally 15 years in a typical, 30 year mortgage), the tax deductions add up to huge savings year after year! You're also allowed to deduct what you pay in property taxes on your income tax return. That's a far cry from renting, where your payment every month is gone forever. Better still, when you own a home, it's possible to adjust your income tax withholding amount - so the taxes saved from your mortgage interest deduction can show up in your paycheck today! These deductions make it easier to purchase a home, even if the monthly mortgage payment is larger than your current rental payment. Before making any decisions, you should speak with your accountant or tax advisor to obtain the best advice for your particular situation. For most Americans, home ownership is the best way to reduce their taxes substantially.

 
2. A home can be your best long term investment.
   Every month when you make your mortgage payment, you're building equity in a place of your own. The longer you stay put, the more equity you have. While there is no guarantee that your home will increase in value, many homes ARE worth far more as time goes on, meaning you can build even more equity over time. Many Americans use this build-up of home equity to finance their children's college education, or to enhance their retirement income.

 
3. A first home often leads to a better second home.
   Once you're in the housing market, it's a lot easier to upgrade later. Even if the home you REALLY want is beyond your financial reach at the moment, you can take a step in the right direction by buying a less expensive home today. After you hold onto the first home for a while and build up some equity, you can often sell at a profit and move up!

 
4. You can plan your housing costs better when you buy than when you rent.
   If you've ever received a huge rent increase from your landlord, or have been evicted with just 30 days notice, you know exactly what we mean. Rent increases are normally beyond your control, and you never know when the landlord may pull the rug out from under you. When you buy, you know exactly what your payment will be every month. Plus, there's no landlord coming by to tell you to start packing, or deny you the right to own pets, or to comment on your furnishings or lifestyle.

 
5. And finally, you gain the satisfaction, prestige and security of home ownership.
   You're free to decorate as you choose, and make whatever improvements you want to your home. You'll find out first hand what "pride of ownership" really means. More importantly, chances are you'll put down stronger roots, and feel more a part of your community than ever before.