Should You Buy or Rent? A Mortgage Loan Officer's Perspective on 1625 Aspen Village Way, West Covina, CA

As a mortgage loan officer, one of the most common questions I get from clients is whether it makes more financial sense to buy or rent a home. If you're eyeing the property at 1625 Aspen Village Way in West Covina, CA, with a purchase price of $575,000, this decision is crucial. Let's break down the numbers and compare the financial implications of buying versus renting over the next nine years.

The Cost of Buying

If you decide to purchase the property at 1625 Aspen Village Way, you’re looking at an estimated interest rate of 6.25% on a 30-year fixed mortgage. Here's what your costs might look like:

• Down Payment: Assuming a standard 20% down payment, you’ll need to put down $115,000.
• Loan Amount: This leaves you with a loan of $460,000.
• Monthly Mortgage Payment: Your principal and interest payments would be approximately $2,834 per month.
• Property Taxes and Insurance: Factoring in property taxes (around 1.25% of the home value) and homeowners insurance, you can expect to pay an additional $720 per month, bringing your total monthly housing cost to about $3,554.

Total Cost Over 9 Years

Over the next nine years, you would pay approximately $383,424 in mortgage payments, property taxes, and insurance. However, real estate in West Covina is expected to appreciate at an average rate of 5.01% per year. If this holds true, your property’s value could rise to approximately $886,619 in nine years.

Building Equity

One of the significant advantages of buying is building equity. By the end of nine years, you’ll have paid down a portion of your mortgage, and with the property’s appreciation, your home equity could be substantial.

• Principal Paid: Approximately $69,759 of your mortgage would be paid off.
• Estimated Equity: With the appreciated home value, you could have around $496,619 in equity (including your initial down payment).

Conclusion: Is Buying Worth It?

When comparing the financial outcomes, buying the property at 1625 Aspen Village Way in West Covina offers a significant potential upside due to home appreciation and equity building. While renting might save you money on monthly costs in the short term, buying could lead to a considerable net gain in the long run.

Of course, this decision is personal and should take into account your financial situation, lifestyle, and long-term goals. If you're planning to stay in the area for several years, buying could be a smart move. However, if you're uncertain about your long-term plans, renting might offer more flexibility.

If you have any questions or need further assistance in making this decision, feel free to reach out. I'm here to help you navigate the complexities of home buying and ensure you make the best choice for your financial future.

David Delgado

NMLS# 349079 • Freedom Choice Lending

Office: (562) 281-6163

www.FreedomChoiceLending.com

Click Here To schedule a 15 minute loan consultation

The terms are based on 6.379% APR.