When purchasing or selling a home, one should consider the many tax benefits.  Buying a home is usually the biggest investments a person will ever make. Due to various tax benefits put in place by the government to encourage consumers to purchase homes, buying a home could be a very wise decision. In order to better understand these benefits, it is important to consult with an accountant or financial adviser.


One of the largest tax benefits is the deduction of mortgage interest. The interest paid on a primary residence can often be deducted if the consumer ops to itemize deductions on their Federal Income Tax Return.  The consumer could potentially claim a deduction for any interest they have paid on mortgages for building, purchasing a home, or even a mortgage taken out for home improvements, as long as the house secures the mortgage.


In addition to mortgage interest, property taxes and homeowners insurance are also tax deductible.  Private Mortgage Insurance (or PMI) is also deductible.  However, VA Loans never have PMI.


The VA does not charge PMI, but they do often charge a one-time funding fee between 1.25 – 3.3%, that is often added to the loan.  This fee is a one-time tax deduction.  Disabled veterans who receive compensation for their disability are VA funding fee exempt.


When tax season approaches, after a consumer has purchased a home, they may be confused about settlement charges when filing their income tax returns. When a consumer takes on a mortgage to buy a house, or refinance their current home loan, there will be some closing costs that will come up. Typically, these are compromised of fees to process the sale, check the title, have the property appraised, and drafting of the contract and the record of the sale.

All of this can seem overwhelming, especially if a consumer is a first time home buyer. Regardless, it is best to discuss any questions or concerns with a reputable tax specialist.

The Chapman Lending Team at HomeBridge Financial is honored to help many veterans utilize their VA home loan benefit each and every year.  We ARE NOT a call center.  Our goal is to provide the best customer service in the industry along with the most competitive rates and fees.

Semper Fi, Dan Chapman CAPT, USMC (vet)          Call (760) 456-7139

Get a Free Rate Quote  –  Start an Online Application

Related Articles

Higher loan limits have just been announced for 2018.  This is great news for anyone looking to purchase a home in the coming year.  It is not yet confirmed that FHA and VA will increase accordingly, but most likely they will.  If you are currently in escrow and/or closing after…
Read More

The 2018 VA Loan Limits have been released. The VA loan program does not have a maximum amount a veteran can borrow using a VA loan. For 2018, the ZERO down payment limit will increase to $453,100. San Diego has increased from $612,950 to $649,750. The Chapman Lending Team at…
Read More

On December 8th, 2017, The Chapman Lending Team is proud to sponsor the Army-Navy golf tournament at Admiral Baker Golf Course.  Each year the U.S. Naval Academy gives classmates and friends the opportunity to reunite while donating to the Naval Academy Foundation. The Chapman Team will have a table set…
Read More

Most people are already aware that one of the perks of using a VA loan is the zero down payment for homes that are under the loan limits provided for your specific county.  However, another perk is becoming exempt from paying the Funding Fee if you have a service-connected disability…
Read More