The IRS estimates nearly 155 million individual tax returns will be filed in 2018, and those expecting a large return are already looking for ways to use the money.
If you’ve been thinking about buying a home, consider using your tax return towards this purchase- it’s not every day you get a large sum of money!
Here are three ways your tax refund can come in handy for purchasing a home:
- Saving for a down payment.
For most, one of the biggest obstacles to homeownership is the down payment. However, don’t fall into a common trap and overestimate the size of the down payment you need. In some cases, it is actually less than you thought.
It’s recommended you speak with a local Sierra Pacific Mortgage Loan Officer to help you determine what how much of a down payment you will need to save for, based on the best mortgage that suits your needs. This an obligation-free action that will help you prepare for the home buying journey. Using your tax refund to jump-start the saving process will motivate you to work towards your goal of homeownership!
- Use the money for closing costs.
Typically, a certain percentage of the home’s purchase price includes closing costs. Closing costs vary widely based on where you live, but you can find out more by contacting a knowledgeable Sierra Pacific Mortgage Loan Officer. Put your tax refund towards your closing costs and check off one more financial obligation on your path to homeownership!
- Lower your interest rate.
You can also use your refund by purchasing what’s called “discount points.” This effectively means you can make an upfront interest payment to lock in a lower interest rate on a fixed-rate mortgage. Why would someone want to do this? Generally, most people buy down their rate up front to save in interest payments over the life of the loan. To see if this would be a good idea for your particular situation, contact your local Sierra Pacific Mortgage Loan Officer!
As you can see, there are many ways to use your tax return. If you’ve been thinking about purchasing a home, consider the above options and contact your local Sierra Pacific Mortgage Loan Officer so you can get started the path to homeownership!