Owning a home can have its own individual set of advantages as opposed to renting. Not only is there an emotional side to owning a home, but there can also be some financial benefits, especially once tax season rolls around.
Before you start qualifying for a home loan, familiarize yourself with a few basic tax advantages than come with being a homeowner.
Each time you receive a mortgage there tend to be additional costs and fees involved. Some of these fees are sunk into the overall price, while others such as prepaid interest, origination fees and loan discount fees can typically be written off on your taxes.
For homeowners who have steep property taxes, the good news is that you can deduct your property taxes on your federal tax return. This deduction can be used for each year that you live in the home.
Additionally, the payments made on a 15- or 30-year mortgage are usually mainly interest during the first half of the mortgage term. This interest can be written off and could end up saving you a ton a cash.
After buying your home, should you ever decide to sell it, you have the right to deduct some of the costs that go along with that as well. This can include real estate agent commissions, title insurance, legal fees, advertising, administrative costs, inspection fees and any repair or redecorating costs within the 90 days leading up to the sale.
Owning a home is a major financial step and should be part of your overall financial plan. After making a mortgage rate comparison to find the best loan, Freedom Mortgage can help you stay on top of your mortgage.
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