Tax season is upon us, but it doesn’t have to be a scary time! If you’ve been thinking about homeownership, this could be a time to move closer to your goals. Consider these options of what you could do with your tax refund to start your journey to homeownership.
Use your refund as a down payment
A down payment is often one of the biggest obstacles to homeownership for first-time homebuyers. Spending a large chunk of money all at once often keeps potential homeowners from ever reaching their dream homes! This year instead of spending your tax refund on new clothes or a big new TV, consider making your refund work for you and put it towards the down payment for a home. Sometimes a tax refund can cover the entire down payment on a home purchase.
Use your tax refund for closing costs
Even with 100% financing mortgage programs like USDA or VA, your tax refund can still be put to good use for your home purchase. Use the refund to pay closing costs, or save the money in case a financial emergency arises as a new homeowner.
Use your tax refund for paying off debts
Oftentimes, debt on a credit card can affect your credit score. Lower credit scores can affect your ability to get certain types of home loans, and while EPM does offer some low credit score home loan programs; it is best to start your journey to homeownership with improved credit and debts paid down.
Use your tax refund for a starting a savings account
Maybe you’re not quite ready for a homeownership purchase, but saving your tax refund or some of your tax refund for your future homeownership goals is never a bad idea!
Having some money saved already once you go to apply for a loan gives you good peace of mind for your ultimate goal.