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    It’s that time of year again — tax refund season! As a homeowner, you have a unique opportunity to make your refund work for you in ways that can significantly impact your financial future. Here are some practical and beneficial ways to put your tax refund to good use.

    1. Boost Your Mortgage Payments

    One of the most financially savvy moves you can make is to increase your regular mortgage payment. Consider these options:

    • Increase your monthly payment: Adding even a small amount to your regular payment can shave years off your mortgage and save thousands in interest.
    • Make an extra payment: Use your refund to make an additional mortgage payment. This can have a similar effect to increasing your monthly payments.
    • Double your payment: If your refund is substantial, doubling one month’s mortgage payment can make a significant dent in your principal.

    If you’re currently paying private mortgage insurance (PMI), it’ll shorten the time until you can cancel PMI — and save hundreds every month. To see how much an extra payment toward your mortgage could save you, check out our mortgage calculator.

    2. Pay Off Other Debts and Consider Refinancing

    If you have one or more high credit card balances, a car loan, or student loan, think about using your refund to pay those off — either partially or in full. When you’re done, if rates are below what you’re currently paying, consider applying for a refinance loan. With less debt and a better credit score on your side, you’ll be primed for a lower interest rate, which means thousands saved over the next decade.

    3. Invest in Home Improvements

    Your tax refund can be a great way to fund home improvements that increase your property’s value and enhance your quality of life.

    • Energy-efficient upgrades: Install new windows, add insulation, or upgrade to energy-efficient appliances to lower your utility bills.
    • Kitchen or bathroom remodel: These improvements often offer the best return on investment when it comes to increasing home value.
    • Curb appeal enhancements: Landscaping, a fresh coat of exterior paint, or a new roof can make a big difference in your home’s appearance and value.
    • Necessary repairs: Address any lingering maintenance issues to prevent more costly repairs down the road.

    Home improvements not only make your living space more enjoyable, but can also increase your home’s value, potentially yielding a return on your investment when it’s time to sell. Remember, the best use of your tax refund depends on your individual financial situation and goals.

    Whatever you choose, using your refund wisely could help put more money in your pocket and improve your quality of life. Get in touch with an Embrace loan officer to learn more or to start the refinance process.

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