Are you getting a tax refund? That can help you add a little cash to your savings. According to a post from Keeping Current Matters, the average tax return in 2025 is 3.9% higher than 2024. This is according to the IRS as of the last week of March.
There are different ways to come up with money for your down payment, a tax refund is just one of them. Putting aside a specific amount every month can help. Are you paying less for rent than you will be for a house payment? Try putting the extra into a savings account. That way you can save money and get used to a new house payment. I will tell clients to do this frequently. Recently I had a client that sent me their bank statement and in the savings account, there were transfers every month from checking, along with a comment that said “extra rent/get used to it”! I thought that was great!
Expect to need 3-5% for a down payment and then you need money for closing costs. There are a couple options to cover closing costs, you can save for them, expect another 3% roughly depending on the price of the home. You can also ask the seller to contribute towards your closing costs. This may work out but if the home was just listed or is in multiple offers, it can be more difficult to get done.
Some people are able to get a gift from parents or a family member. This can be a great way to get extra money for your down payment. Remember we do need to document the gift.
There are also different down payment assistance programs that may be able to help you. We have a program called Smart Start and if your income is under 80% of the median income and you are putting 3-5% down on a conventional loan, you may be able to get up to $4000 in a grant that doesn’t have to be paid back.
Work with your loan officer to figure out what you need to save and how much you need for closing. We are here to help you along the way! You may be closer than you think!
Leslie Vanderwerf, NMLS ID#335509, CrossCountry Mortgage LLC, An Equal Housing Lender, NMLS#3029 – Email – Website
