According to data released by the Internal Revenue Service (IRS), Americans can expect an estimated average refund of $3,143 this year when filing their taxes. This is down slightly from the average refund of $3,436 last year.
Tax refunds are often thought of as ‘extra money’ that can be used toward larger goals, like retirement, paying down loans, or even buying a house. For anyone looking to buy a home in 2019, your tax refund can be a great jump start toward a down payment on your dream home!
The map below shows the average tax refund Americans received last year by state, with the highest refund being found in Connecticut and the lowest refund being found in Maine.
Many first-time buyers believe that a 20% down payment is required to qualify for a mortgage, but programs from the Federal Housing Authority, Freddie Mac, and Fannie Mae all allow for down payments as low as just 3%. Veterans Affairs Loans even allow many veterans to purchase a home with 0% down, making the goal of owning a home all the more attainable.
If you started your down payment savings with just your tax refund check this year, how close would you be to a 3% down payment?
The map below shows what percentage of a 3% down payment is covered by the average tax refund by taking into account the median price of homes sold by state.
The darker the blue, the closer your tax refund gets you to homeownership! For those in Oklahoma looking to purchase their first homes, their tax refund could potentially get them 85% closer to that dream! While it may be a little harder to stretch your tax refund on the West and East Coast or the Hawaiian Islands, purchasing a home in the Midwest or the south may prove a little more affordable in terms of down-payments.
Saving for a down payment can seem like a daunting task, but the more you know about what’s required, the more prepared you can be to make the best decision for you and your family! Arm yourself with knowledge, and this tax season your refund could be your key to homeownership!