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The Pros and Cons of Borrowing the Down Payment for Your Next Elk Grove Home - Thinking of Buying a Home in Elk Grove

By Mike & Jennifer Rigley

Real Estate Agent with Real Estate Specialist -Rigley Realty Group 01391317 / 01472902

April 07, 2017 08:27 AM

Mike and Jennifer Rigley (buyers) 916.378.4671 / (sellers) 916-660-5823 Info@RigleyRG.com
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With the rising cost of real estate, many people feel that now is a good time to buy an Elk Grove home to ensure a good financial future. However, if you haven't saved up enough money to make a down payment, it's possible you may be considering whether or not you should borrow the funds. If you're considering a loan from friends or family, here are some points you may want to think about before asking for a loan.

Getting Out Of the Rental Market

With even the rental market seeing huge increases in its rental rates, buying an Elk Grove home can be an even more beneficial purchase than ever. While your rental check is gone once you've paid it each month, payments on your mortgage will become a part of the wealth you're building and the equity in your home. It's just important to consider the property taxes and maintenance that go along with purchasing a home beforehand, as these added costs might end up making for a poor investment if they're too costly.

Saving Money on Insurance

You may have heard many different things about the percentage your down payment should be, but because you will have to pay mortgage default insurance if you put less than 20% down, it can be an added boon to borrow the additional funds needed. While borrowing the money can be great in terms of lowering your monthly payment and making your Elk Grove home less costly in the end, it can also cause financial strain for you since you'll have to pay back the funds over time.

Testing Your Relationships

It goes without saying that money can often times get between people, and when it comes to borrowing a significant sum of money from family or friends, this can improve your relationship or even cause a rift. While you may be willing to take this risk if you have no concerns about paying those who have lent you money back, if something arises and you're unable to give back the funds, this can create issues that may be more problematic than renting a little longer.

Many people consider borrowing the money for their down payment in order to come up with the 20%, but it's important to consider what borrowing this money can mean for your financial future and your personal relationships. If you're currently looking into a new Elk Grove home, you may want to contact one of our mortgage professionals for more information.

To stay up to date with more Elk Grove Community News and Events, Elk Grove Real Estate information, log on to www.RigleyRealtyGroup.com

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