Build up your emergency fund. It is always a good idea to have cash on hand for little emergencies, but a nice cushion is even better. How long could you continue to make your mortgage payments if you lost your job? If your answer is six months or less, build up your cash reserves then consider paying down other long term debt like your home loan.

So why should you prepay on your mortgage? If your home loan is last hurdle in you goal to become debt free, pay as much as you can towards reducing loan. Even if you get maximum tax right offs nothing can compare to psychological effect of knowing that you own your small piece of America. Work out a budget with a financial planner or a tax advisor and setup a payment schedule.

Build up equity. Owning a home is like setting up an automatic savings account. Each mortgage payment is like making a small deposit into a bank account that secures your future. After two or three years you can use built up equity to purchase more properties or get an equity line of credit in case of emergencies or a sudden job loss. All of these possibilities are options that are not available to renters.

Build ties in your community Home ownership is on of signs that you have fully matured and are ready settle down. You will probably remain in your first home for at least a couple of year so you will have an incentive to participate in your community as a way to protect your financial investment. As you are building up your homeowners’ equity, you are also building relationships within your local community and that benefits you, your neighbors and your city or county. It is ultimate sign of responsibility.

These are just a few things that should keep in mind if you’re wondering if home ownership is right thing for you.