How to use your tax refund to buy a house

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Rocket Mortgage’s RocketONE+ mortgage only requires 1% down. If you get $3,379 back from Uncle Sam, that’s a 1% down payment on a home that’s listed for $337,900.

In most of the U.S., $338,000 can get you a lot of house.

Rocket Mortgage

  • Annual Percentage Rate (APR)

    Apply online for personalized rates

  • Types of loans

    Conventional, FHA, VA, jumbo, HomeReady, Home Possible

  • Terms

    10-, 15- and 30-year fixed-term conventional loans, 30-year VA and FHA loans, custom mortgages with fixed-rate terms from 8 to 29 years.

  • Credit needed

  • Minimum down payment

    0% for VA, 1% for RocketONE+, 3% for conventional, 3.5% for FHA, 10% to 15% for jumbo

  • Already have a mortgage through Rocket Mortgage or looking to start one? Check out the Rocket Visa Signature Card to learn how you can earn rewards

Pros

  • One of the largest home lenders in the U.S.
  • Offers 1% down mortgage
  • High scores for customer satisfaction from J.D. Power
  • Shorter-than-average closing time
  • Rebate of up to $10,000 for buying with Rocket Homes

Cons

  • No USDA mortgages, construction loans or HELOCs
  • Hard credit check required for customized rate
  • Higher origination fees than the competition
  • No physical branches

You could also put that refund toward an FHA mortgage: Insured by the Federal Housing Administration, FHA loans only require 3.5% down if you have a credit score of at least 580.

If your federal refund is $3,300, that’s 3.5% of $94,285. That might not be enough for a home in a lot of places, but if you also get a refund from the state or qualify for down payment assistance, it can go a lot further.

The median home price in Alabama, Arkansas, Ohio and Indiana is close to $250,000, according to Redfin.

Start preparing your taxes with these options

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Chase Bank is a great option for an FHA mortgage, with 4,500 locations nationwide and the Chase DreaMaker loan, which only requires a 3% down payment. That $3,300 is enough to get you a home for $110,000 — or to make a big dent in a $7,500 down payment on a $250,000 home.

Chase Bank

  • Annual Percentage Rate (APR)

    Apply online for personalized rates; fixed-rate and adjustable-rate mortgages included

  • Types of loans

    Conventional loans, FHA loans, VA loans, jumbo loans and proprietary low-down-payment DreaMaker℠ and Standard Agency mortgages.

  • Terms

    10 – 30 years

  • Credit needed

  • Minimum down payment

    3% for DreaMaker℠ or Standard Agency loan

  • Terms apply.

Pros

  • Chase DreaMaker℠ loan only requires 3% down payment
  • Existing customers eligible for rate reduction
  • Above-average customer satisfaction scores
  • Closing timeline guarantee
  • Homebuyer grants of up to $7,500

Cons

  • No USDA loans or HELOCs
  • No closing guarantee for refinancing
  • Chase homebuyer grant only available in select areas.

Your refund won’t automatically get you into your dream house, especially since the median price for a single-family home was $419,200 in the fourth quarter of 2024, according to the Federal Reserve Bank of St. Louis. A tax refund of $3,379 is only about 0.80% of $419,200 and conventional mortgages typically require 3% to 5% down.

But it’s a healthy start — and in most of the country, home prices are significantly less. So, you may be able to get a home with your tax return and no extra help at all.

Of course, a down payment isn’t the only expense you’ll incur in the homebuying process. You’ll need money for lender fees, closing costs, movers, mortgage insurance and more.

But with smart saving strategies you can bridge the gap and make the dream of owning a home a reality.

Mortgage FAQs

How much do you need for a down payment?

You’ll typically need 3% to 5% of the home price to put towards a down payment. USDA loans and VA loans don’t require a down payment and some lenders offer mortgages with less than 3% down for borrowers who meet income or location requirements.

Can you buy a home with no down payment?

VA loans and USDA loans do not require down payments and some lenders, like Guild, will provide borrowers with a second repayable or forgivable mortgage to fund the down payment so you don’t have to pay anything up front.

How much down payment do I need for a $200,000 home?

The amount of your down payment depends on your finances and your lender. But to put at least 3% down on a $200,000 home, you need to have $6,000 in cash.

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