The American dream of homeownership is a very feasible aspiration for 2012.

There are many benefits of owning a home.  Yet some first-time buyers are skeptical of purchasing with the uncertainty surrounding the housing market.

The uncertainty many reference when speaking about the housing market involves a specific date when home values will increase. Since no one can pinpoint this date, the word uncertainty (when paired with the housing market) often reveals a negative connotation.

There are some factors we can be certain about in this housing market such as home values rebounding.  This is true; the housing market often moves in cycles.

It’s safe to assume that many Americans harbored the same uncertainty during the George H. W. Bush administration in the early 1990s when the national homeownership rate fell from its previous historic high of 64.4 percent in 1980 to a low of 64.1 percent in 1991.

In the 1960s Lyndon Johnson illustrated a correlation between homeownership and accountability by stating “owning a home can increase responsibility and stake out a man’s place in his community…The man who owns a home has something to be proud of and reason to protect and preserve it.”

This statement is still true more than 50 years later.  There are many reasons to take pride in homeownership such as:

• Appreciation – Buying a home now (at the current rates) can almost ensure your home’s appreciation in the future.  Mortgage rates are near historic lows and home prices in many parts of the country are down.  This is the perfect recipe for home appreciation.  Additionally, many foreclosed homes are available for a fraction of the original cost.  This can translate to a higher profit if you decide to sell once the market rebounds.

• Property Tax Deductions – For income tax purposes, real estate property taxes for a vacation home and first home are fully deductible.  The IRS (Publication 530) provides detailed tax information for first-time buyers that may answer many questions about what deductions homeowners are eligible for.

• Preferential Tax Treatment – If you own your home for more than a year and receive more profit than the allowable exclusion after the sale of your home, the profit will be considered a capital asset.  Capital assets are given preferential tax treatment.

• Equity Building – Many factors such as credit qualification, loan flexibility, and annual percentage rate (APR) contribute to the final decision of what type of mortgage loan best fits your goals.  Yet, a new trend being used by some homeowners is to actually add money to their monthly payment to decrease the principal balance of their loans at a much faster pace.  This trend is called equity building.  Equity builders usually select a home loan with a lower interest rate (and a shorter term loan such as a 15-year fixed) to help build equity faster.  This rapid payment process allows borrowers to:

• Pay off the principal balance faster
• Lock in near-record-low interest rates
• Shorten the length of their home loan
• Own their home faster
• Pay substantially less mortgage interest

Equity building is a beneficial trend that’s becoming more and more popular with fiscally responsible homeowners.  Also, home equity is the largest single source of household wealth for most Americans.

• Pride – Homeownership offers many benefits to many different types of people.  For some homeowners, playing your music as loud as you want and painting the walls the color of your choice is a perk.  For me, homeownership will permit me to build an NBA regulation size basketball court on my own property.  For my coworker Joel Jarvi, home ownership may allow him to build the indoor slide of his dreams.  No matter who you are, homeownership is a purchase, commitment, and journey that’s sure to bring you pride.

Furthermore, when the uncertainty surrounding the housing market fades and the market rebounds, homeownership may in fact transform that pride to profit through a home sale.

Jonathan Slappey is a writer for Quicken Loans, a company whose clients believe it’s Engineered to Amaze.  Interested in being Amazed by us? Read trusted reviews at our review site.

One of the rarely touted advantages of people taking FHA mortgages today is the fact that they are assumable. What that means is, when the FHA homebuyer of today is looking to sell his home, a qualified purchaser can “take over” their loan.

Most people believe that interest rates will return to a “normal” range (between 6.5% and 7%) in a couple of years. When you assume a mortgage, the terms remain the same. This means that a buyer five years from now can enjoy a 4 – 4.5% mortgage by assumption rather than the 6.5% – 7% mortgage they would get without it. Since most people buy homes based on how the monthly payment fits into their personal monthly budget, this is extremely impactful.

As an example, a $300,000 loan at 4% today carries with it a $1,432.25 principal and interest payment on a 30 year fixed mortgage. If offered for sale in five years, the purchaser could assume the $271,858.56 balance with the same $1,432.25 payment and remaining term of 25 years. The total payments over the 25 years would be $429,675.

Compare that to a new $272,000 loan at 6.5% for 25 years, which would carry a monthly payment of $1,836.56 (over $400 more a month than the assumption and more than $120,000 more over the 25 year term).

At 6.5% for 25 years, to wind up with the same payment as the assumed mortgage, our borrowers would only be getting $212,000…$60,000 LESS!

The point here is that, when rates go up, homes with assumable mortgages will have more value and will sell at higher prices because they are more affordable. As an additional bonus, the closing costs on assumable mortgages are significantly less (especially here in New York where NYS Mortgage Tax is such a large component of closing costs).

The borrowers must be credit-worthy of course (have good credit, qualifying income, and necessary assets to close), but they would have to be credit-worthy to get a new mortgage too!

Besides the multiple other reasons to obtain an FHA mortgage (low down payment requirements, extended income ratios, lower credit scores, and easier sourcing of funds), there is another perk. In the future, there is a good chance that you may be able to sell your home for more money because of the FHA loan’s assumability.