Four Ways to Use A Tax Refund for Home Ownership

Americans have gotten another reprieve from the government with the extension of this year's tax filing deadline to May 17th. If you're getting a refund, it's never too early to start thinking about how you're going to use the funds. Investing in home ownership is an excellent way to spend your funds wisely. Here are four ways you can utilize those funds toward home ownership.

1. Saving toward a down payment. 

Although many loans require 20% down to avoid private mortgage insurance, there are many options available. Be sure to check with a reputable lender to find the best loan for your needs. An easy way to estimate your down payment amount is a mortgage calculator. Be sure to research available loan types. Click here to find contact information for our preferred lenders. 

2. Paying down your debt.

Your credit score is key to financing. The better the score, the lower your interest rate will be. A great way to improve your credit score is to pay down high interest credit cards Your tax return can help to put a dent in that debt and raise your credit score.

3. Earnest Money Deposit.

A deposit is required when purchasing a new home. Generally speaking, that amount is from 1 to 3% of the sales price. If you're building a new home by Holiday Builders or purchasing a move in ready home, simply ask your New Home Consultant how much you'll need for a deposit. 

4. Closing Costs.

There are several non-negotiable closing costs that you'll incur with your home purchase. Among these costs are title insurance, property taxes, credit report research and appraisal fees. These are outlined on your closing statement and your title company can assist in explaining each fee.

There are many benefits to building or buying a new construction home versus a resale home. When you build new home or purchase a move in ready new home, you don't have to worry about the cost of a home inspection or costly repairs, rehabs or remodeling. Buying a new home saves money on home owners insurance as well as new is a less risky proposition for the insurance company. 

Your tax return can be a very useful tool when it comes to purchasing a new home. Maximize your funds by applying them to one of the costs outlined in this blog and by purchasing a new home instead of a resale home.