Tax Refund for Down Payment

Tax Refund for Down Payment

Many people are receiving their tax refund or anticipating receiving one. If you find yourself in this fortunate position, have you considered using it for a down payment on a home? The more you can contribute towards your down payment, the less you will have to borrow. 

An article on realtor.com states; “According to the IRS, the average refund for 2013 tax returns was $3,013 as of March 24, slightly higher than the average for 2012 tax returns. A tax refund of $3,000 can go a long way to a down payment on a home, particularly if you’re using an FHA-insured loan to finance the purchase since you would need just 3.5% of the home price for the down payment.” Even if you find yourself receiving a smaller amount back, could you save it to use towards a down payment? Saving your tax refund amount could help boost your already existing savings or jumpstart it, if you are just starting to save for that down payment. 

In fact, that same article mentions, “you may be tempted to use your tax refund for a splurge, but one of the best ways to accelerate your savings and improve your finances is to take “found money”—such as a tax refund or an unexpected bonus—and put it directly into your savings or to pay off debt.” To learn more about ways to use your tax refund, please read the sourced article below. (Please note: Stockton Mortgage does not provide tax or legal advice. Consult your tax attorney or a CPA for information.) To learn more about what we offer at Stockton Mortgage, check out our website: https://stockton.com/

Source: https://www.realtor.com/advice/finance/getting-tax-refund-consider-using-payment/