1. Mr. Woodington’s Money Management II

2.  Should I Rent or Own?  The Tradeoffs of Each  Financial Numbers and Considerations  Tips Before You Begin The Hunt  The Process of House Hunting

3.  The choice of where to live is an extremely personal one. This personal decision is influenced by other factors, namely financial limitations  The choice to rent or purchase housing boils down to two primary factors:  Your Lifestyle  Finances (Yours and the world around you)

4.  This means all of the following can come into consideration when making a housing decision:  Personal and financial goals  Personal values, needs, and wants  Amount of money available for housing costs  Financial resources and readiness  Credit history  Real estate prices/Mortgage rates  Location preference  Expected length of stay in particular place

5.  If you decide to rent you will enjoy the following advantages:  Location choice  Less responsibilities (maintenance, repairs, general upkeep)  Extra amenities  However with these advantages come certain tradeoffs, including:  Subject to terms of a lease, rules of the community  Less privacy and transient neighbors  No equity (Equity = The value of something less the amount still owed from purchasing it)

6.  Advantages of purchasing a home include:  Pride of ownership  Builds equity over time/Tax breaks  Much more freedom and flexibility for customizations  However, in return for these advantages you must sacrifice the following:  Larger costs, both initially, reoccurring &long term ▪ Initial costs = Down payment, closing costs ▪ Reoccurring = Taxes, general maintenance ▪ Long term = Major maintenance issues (Ex: New Roof)  Time and energy commitment

7.  Housing is the largest personal expenditure, accounting for almost 1/3 of a person’s net income  Understand your other expenses, based upon your lifestyle, by creating and adhering to a budget  When purchasing a home you should aim to place a minimum of 10-20% of the home’s purchase price as a down payment  The purchase price of a home should not exceed 2 ½ times the annual household income

8.  Understand what you’re getting yourself into  Review your needs and goals, not just for now but for the future as well  Review your credit  Build a professional team  Agent (Preferably Buyer Exclusive)  Home Inspector  Get pre-approved for a loan  Set your limit, trade-up as time goes on

9.  As you are looking for a home to purchase, remember the following:  Visit the area at multiple times during the day  Get a home inspection, review and understand the report  Do your homework! ▪ Research schools ▪ Crime in the area ▪ How much are other homes selling for?

10.  Choosing to rent or purchase a place to live is a highly personal decision. The two main factors to consider are lifestyle and finances.  There are tradeoffs that come with your decision, both when choosing to rent or own and when selecting the actual residence.  Be sure to take your time and do your research when making this important decision!