Working with the Mortgage Professor to purchase a home can be a wise decision due to several tax benefits. Learn more about what benefits are out there.
Tax Benefits of Buying a Home with the Mortgage Professor
When you decide to purchase a home and obtain a loan from a trusted lender like Mortgage Professor, you probably aren’t thinking about your taxes. Fortunately, home ownership can be an advantage in this area. The government rewards homeowners by allowing a deduction for interest expenses and a reduction in taxes paid for capital appreciation.
Deductions for Mortgage Interest
One of the most significant benefits of being a first-time home buyer is the deduction of mortgage interest you’ll receive when it’s time to pay your taxes. If you decide to itemize deductions, you’ll be able to deduct the interest paid on the mortgage that you obtained from Mortgage Professor.
There is a limit on how much you can deduct, and the limit is based on the amount of your mortgage. If it exceeds $750,000, there is a cap on how much mortgage interest can be deducted.
Financial Benefits When Selling Your Home
Owning your own home provides independence and the freedom to do what you want with your property. It also gives you a substantial benefit financially if you decide to sell your home in the future.
If the value appreciates and you sell at a higher price than you paid for your home, you’ll have a chance to wholly or partially exclude your capital gain from being taxable. There are specific rules that apply to this that should be examined before working on your taxes. It’s usually best to speak with a tax professional to make sure you stay compliant.
Working With a Knowledgeable Lender
If you’re a first-time home buyer or self-employed, a knowledgeable lender like Mortgage Professor can look at your salary or income and see if you qualify. When you have the appropriate amount to cover your mortgage and other necessities such as property taxes and home insurance premiums, we can help you decide if a 30-year, 20-year or 15-year fixed-rate loan is best. We will also look at your debt ratios and determine if your current income can cover the monthly housing expense and total debt expense.
It’s nice to know there are extra tax perks available when you own a home. Once you go through the mortgage process with a knowledgeable lender, you’ll be able to enjoy these benefits and much more.