April is upon us, meaning taxes are due. In this week’s edition of the Mortgage Minute series, Travis Evans, a mortgage banker with Academy Mortgage, explains how your taxes can affect a home mortgage.
Many people may be unaware of this, but your tax return can affect the amount of mortgage you may qualify for. For example, filing a business return and reporting a lot of income while also having a lot of deductions will be taken into account when you apply for a loan. Deducting a great deal of mileage off of your taxes may affect you, as well. To help reduce the affects your taxes will have on your mortgage, give a copy of your tax return to a mortgage professional. That way, when you are out shopping for a new home, or if you are under contract with new construction, you can make sure that it does not affect the approval or the amount of home you can purchase.
If you are a salaried employee that receives a W-2 and reports a negative income because of your deductions, you may be severely limiting the homes you can buy.