It’s tax season, and if you have received or expect to receive a refund, there is no better time to start thinking about purchasing a new home.
Some Californians see their tax refund as too small to truly impact any big purchase like a house. Instead, they consider a short vacation, a new appliance like a refrigerator, or acquiring a new car. They may not see a tax refund as a possibility of first steps toward a first, or new, home. Below are some of the ways you can make your refund work for you and make your larger dreams come true.
- Put Your Refund Toward Your Down Payment: Of course, adding that refund to your down payment will make the entire process that much easier. Perhaps you haven’t quite saved enough for the proper down payment. Well, stop putting it off and add that refund money now. Every little bit helps and gets you that much closer to the dream.
- Save Your Refund for Closing Costs: Closing costs such as appraisals, inspections, and lawyer fees can not only add up at the end of the process but also pile on even more stress during what is already a stressful process. Knowing that you have that refund money waiting to help with those costs can improve your finances and your peace of mind.
- Use Your Refund to Create an Emergency Fund: Another way to relieve some of the stress of making a big purchase can be to put that refund money into an emergency fund for whatever happens in the future. Then you can concentrate on buying your new home knowing that if your car goes into the shop, you at least have a little insurance to keep you safe.
- Use Your Refund to Repair Your Old House: If you are selling one home and buying a new one, you might want to make some upgrades to increase the value of your old home. Coming across this money can be difficult for some. Consult California’s Energy Savings Assistance Program and make upgrades such as energy-efficient lighting or weatherstripping. This could be one more selling point for your old house, or use that refund money to make the same upgrades in your new home. Either way, your refund can help during this process.
- Pay Off Debt: Use your tax refund to pay down any debt that might be hurting your chances at acquiring better interest rates. Ask your Realtor or advisor which debts (such as items often purchased through finance companies like appliances) are best to pay down because certain debts can actually help you during this process.
Of course, these are just some of the ways your tax refund can help you purchase your new home and build wealth. The important thing to remember here is that the longer you put off starting the process of purchasing a new home, the more expensive and difficult it will become. Is that short vacation really worth it when you could be living in a place that you can truly call your own?
If you are thinking about purchasing a new home in the Merced, California area, contact Soldavi Realty today! We look forward to being a part of the purchase of your new home.