If you’re buying or selling a home this year, you’re likely saving up for a variety of expenses. For buyers, that might include things like your down payment and closing costs. And for sellers, you’re probably working on a bit of spring cleaning and maintenance to spruce up your house before you list it.
Either way, any money you get back from your taxes can help you achieve your goals. Using a tax refund is a common tactic for buyers and sellers. SmartAsset estimates the average American will receive a $2,897 tax refund this year. The map below provides a more detailed estimate by state:
If you’re getting a refund this year, here are a few tips to help with your home purchase or sale this season.
How Buyers Can Use Their Tax Refund.
According to American Financing, there are multiple ways your refund check can help you as a homebuyer in Chicago, IL. A few include:
- Growing your down payment fund – If you haven’t started saving for your down payment, let your tax refund kick off the process. And if you have a fund already, the money you get back could put you closer to your goal.
- Paying for your home inspection – Your home inspection can save you a lot of headaches down the road by helping you determine the house’s condition. As a buyer, you’ll typically be responsible for paying for your inspection, and it’s worth the investment.
- Saving for closing costs – Closing costs are additional expenses you must pay once closing. They average between 2-5% of the purchase price of your home.
This list is a great start, but it isn’t exhaustive of all the costs you may encounter as you embark on your home-buying journey. The best way to prepare is to work with a trusted real estate professional to ensure you understand what’s coming in the process.
How Sellers Can Use Their Tax Refund.
If you own a home and plan to sell in the Chicagoland Area and Surrounding Suburbs this spring, your tax refund can help you ensure your home is ready to list. Here are a few ways current homeowners can put their tax refund to good use:
- Making small upgrades – NerdWallet provides a list of great ways to use your tax refund, including tackling small projects or boosting your curb appeal to help your home stand out.
- Making repairs – If anything in your house needs to be fixed, American Financing notes that completing repairs is another great use of that money.
- Buying your next home – Whether selling to move up or downsize, you can use your tax refund to help pay for any costs on purchasing your next home.
Of course, talking with your trusted real estate advisor before taking on any projects is important. They’ll ensure you can focus on areas that’ll help you receive the best price when you sell.
Funding your home purchase or sale can feel daunting, but it doesn’t have to be. Your tax refund can help you reach your goals. Let’s connect with real estate experts in Chicago, Illinois at KM Realty Group LLC to discuss how you can start your journey.