Income Tax Refunds to Benefit your Real Estate Needs
It’s that time of year again to file income taxes. If you are wondering what might be a great way to invest your refund money here are some great tips why paying off debt can benefit you in the Real Estate Market.
PAYING OFF DEBT WILL IMPROVE YOUR CREDIT SCORE
Your credit score will help you purchase Real Estate by making the loan process much easier.
- While paying off credit card debts start with the cards that have the smallest balances first and bring them to a zero balance. When you bring a credit card balance to a zero amount that will bring your per-card utilization down to zero percent which will result in a higher credit score within the three credit reporting agencies, TransUnion, Experian, and Equifax.
- By paying off debt you can improve your credit score which in return can help you receive better interest rates and terms for financing when you are investing in Real Estate.
- The better your credit score the smoother and quicker qualifying for a Real Estate loan will be, making you that much closer to owning your dream home.
- Once your dream home is purchased; the better your credit score is the better your insurance premiums will be.
- Paying off debt will also lower your debt to income ratio which will make it easier to qualify for a mortgage loan. For an FHA Loan the max qualifying debt burden cannot exceed 43% debt to income ratio.
No matter how you look at it paying off debt is a great thing and if you can boost your credit score while you are in the process, what a great bonus that will be!