Mortgage or cash? It is the dilemma that grips those who have to buy a house and have the money to pay for it all in cash. Most people think the best solution is to pay for everything right away and get it over with. But is not so. Having a cash reserve today is useful and prudent. And if you can have money at almost no cost, it’s better to go into debt https://www.kindhousebuyers.com/wa/kent/
Because the real estate market today offers unique and perhaps unrepeatable opportunities
Perhaps it may seem like the time not to buy a house. Yet it is precisely in moments of crisis that the best opportunities can be exploited. This moment sees a good supply of real estate and little competition, because people are not thinking about buying a house right now. When you are worried about the future, you tend to make cash and not spend. And for this reason the next few months are ideal for buying a house, getting better prices. Thanks to the lack of competition and the desire of those who sell, to monetize as soon as possible. Factor that could bring down the price also significantly.
Once the property has been chosen and the sale price has been identified, we move on to the purchase. And here we need to make a serious reflection. There are two situations in which the buyer can find himself: he has money to pay for it in cash or he has to access the mortgage.
Beware of buying a house with cash without evaluating this aspect
If you don’t have the money to buy the house, then the only way is to take out a mortgage. But if you have cash, paying for the whole property with all your savings might be a risky, not a happy choice.
For any eventuality, purchase of a new car, sudden expenses, a trip, you are forced to apply for a loan. At what cost? Not less than 5.5% per year. These are the current costs on the market. So isn’t it better to pay 0.9% and maybe put the capital in a deposit account or low-risk bond? Operation that will at least cover the interest costs of the mortgage. So be careful to buy a house with cash without evaluating this aspect.
