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Buying a home can bring some changes to your financial situation and how you manage your budget. But how does buying a house affect taxes, specifically? The short answer is that owning a home can yield some tax breaks if you’re able to deduct mortgage points, mortgage interest, property taxes, and other expenses.

How much of a tax benefit you can get from owning a home can depend on a number of variables. If you’re gearing up to buy a home, it’s helpful to know what might change when it’s time to file your tax return.

What Are Home Tax Deductions?

Home tax deductions are amounts that you can write off when filing a tax return. The Internal Revenue Code defines the types of tax breaks for homeowners and what they’re worth.

Tax deductions reduce the amount of your income that’s subject to tax. They’re different from tax credits, which reduce what you owe in taxes on a dollar for dollar basis. Deductions can be standard or itemized.

•   Standard deductions allow you to write off a flat dollar amount, based on your filing status.

•   Itemized deductions allow you to write off individual expenses, based on their actual amount.

If you’re interested in deducting home-related expenses, then you’ll need to itemize them on Schedule A when filing Form 1040.


💡 Quick Tip: SoFi’s Lock and Look ⁺ feature allows you to lock in a low mortgage financing rate for 90 days while you search for the perfect place to call home.

How Tax Deductions Work

Tax deductions work by reducing your taxable income, which can in turn reduce your tax liability. Your tax liability represents the amount you owe in federal taxes and in state taxes if you live in a state that assesses income tax.

When you claim a deduction, that amount is removed from the amount of income that is subject to tax. Deductions are valuable since reducing your taxable income could help you to move into a lower tax bracket. Your tax bracket determines which tax rate you’re subject to. There are seven tax brackets ranging from 10% at the lowest end to 37% at the highest.

Again, you can claim a standard deduction if you don’t have any expenses to itemize. The amount of the deduction depends on your filing status. Here are the standard deduction limits for 2023.

•   $13,850 for single filers and married couples who file separately

•   $20,800 for heads of household

•   $27,700 for married couples filing jointly

Whether it makes sense to itemize vs. claiming the standard deduction can depend on the amount of expenses you’re eligible to write off.

Pros and Cons of Home Tax Deductions

Claiming home tax deductions, or any type of deduction for that matter, can offer advantages and disadvantages. How does buying a house affect taxes in a positive way? The simplest answer is that it can help to reduce your overall tax liability.

Owing less in taxes or even getting a larger refund means that you have more money to put toward other financial goals. The drawback is that itemizing deductions can be a little more time-consuming as you have to list out individual expenses and amounts on your tax return.

It’s also possible that claiming home deductions won’t lead to a bigger tax break than taking the standard deduction. Comparing the numbers can help you to decide which option makes the most sense.

Types of Homeowner Tax Deductions and Credits

There are multiple tax breaks for homeowners that you could claim as a first-time homebuyer or repeat homeowner to put more cash back in your pocket. It may be helpful to talk to a financial advisor or tax professional to better understand which ones you might be able to claim.

It’s also important to note that some tax breaks, such as the first-time homebuyer credit, originally from 2008, have expired.

Property Tax

Property taxes and real estate taxes paid to state and local government entities are deductible for homeowners. The limit for state and local tax deductions is $10,000 as of 2023. If you’re married and file separate returns, the deduction is capped at $5,000.

How much value you get from this deduction can depend on where you live. If you look at the cost of living by state, it’s easy to see that property taxes are higher in some areas than others. When you compare the cost of living in California, for example, to the cost of living in New Jersey, residents of the Garden State pay substantially more in property taxes.

Are property taxes included in mortgage payments? They can be, if your lender requires you to escrow property taxes and homeowner’s insurance into your payments. If you escrow those amounts, part of the money you pay to the lender each month will go to separate accounts to cover those expenses once they come due each year.

Points

Mortgage points allow you to “buy down” your interest rate at the time your home loan originates. Paying points can help you get a lower rate and potentially lower your monthly payments. In exchange, you pay your mortgage lender an upfront fee.

Mortgage points are deductible but there are some rules to know:

•   You must live in the home that secures the loan.

•   Paying points must be an established business practice in your area.

•   Points paid can’t exceed an amount that’s commonly charged in your area.

•   You must use the cash method of accounting for reporting income.

•   Points paid must come out of your funds, not funds borrowed from your lender.

•   Any points paid cannot be applied toward other costs typically included at settlement, such as appraisal fees or attorney’s fees.

•   Points must be computed as a percentage of the mortgage principal.

You can deduct points in full in the year you paid them if those conditions are met. Otherwise, you can deduct points over the life of the loan.

Mortgage Interest

Interest on home mortgage loans is also tax-deductible. You can claim the mortgage interest deduction if you paid interest on a home loan at some point during the year. The IRS determines how much mortgage interest you can deduct.

•   Homeowners can deduct up to $1 million in mortgage interest (or $500,000 if married filing separately) for homes purchased before December 16, 2017.

•   Mortgage interest is deductible up to $750,000 (or $375,000 if married filing separately) for homes purchased after December 16, 2017.

The new, lower limit was imposed under the 2017 Tax Cuts and Jobs Act (TCJA). Beginning in 2026, the higher limit will resume, barring any changes to the federal tax code.

Private Mortgage Insurance

Lenders may require you to pay private mortgage insurance (PMI) when purchasing a home with less than 20% down. Mortgage insurance premiums (MIPs) are required for FHA loans.

As of 2022, the IRS does not allow you to claim a deduction for PMI or MIPs.

Mortgage Credit Certificate

If you’re issued a Mortgage Credit Certificate (MCC) by a state or local government program, you may be able to use it to get a tax break. This is a tax credit, not a deduction, that’s offered to lower-income homebuyers in order to help make home ownership more affordable. If you have an MCC, you can use IRS Form 8396 to figure out how much credit you can claim for the current tax year and what you might be able to carry forward for future tax years.

Renewable Energy

The IRS offers tax credits for homeowners who make energy-efficient improvements to their homes. For 2023, homeowners may qualify for a credit of up to $3,200 for eligible expenditures, including:

•   Energy-efficient doors or windows

•   Insulation and sealing material

•   Natural gas, propane, or oil water heaters, boilers, and furnaces

•   Heat pumps

•   Biomass stoves

•   Home energy audits

Residential clean energy credits are also available for homeowners who install solar panels, solar water heaters, wind turbines, geothermal heat pumps, and fuel cells.

Home Office

If you use part of your home for business purposes, you may be able to claim another homeowner tax deduction in the form of the home office deduction. There are two ways to claim a deduction for home office expenses:

•   Simplified option. This method allows you to deduct $5 per square foot, up to 300 feet, for the part of your home that you use as an office.

•   Regular method. The regular method figures your deduction based on your actual costs.

If you’re claiming this deduction along with other business deductions, you’d include them on Schedule C with your tax return.

Home Equity Debt

Home equity loan interest is tax deductible if the loan is used exclusively to buy, build, or substantially improve the home that secures the loan. If you use a home equity loan for any other purpose, such as debt consolidation or paying college expenses, the interest is not deductible. That rule remains in effect through 2025, whereupon the previous rules will revert.


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Tips on Home Tax Deductions

If you’re considering claiming deductions for home expenses or any other expenses, it’s wise to keep good records. While the odds of being audited by the IRS are rare, they’re not zero so it’s smart to have receipts, official tax forms, or other documentation to back up the deductions you’ve claimed.

Also, keep in mind that some expenses are not deductible for homeowners. The kinds of things you can’t deduct include:

•   Mortgage principal payments

•   Depreciation

•   Utilities

•   Down payments

•   Homeowner’s insurance premiums

•   HOA fees and condo fees

•   Maintenance and upkeep

There are exceptions for some of these expenses if you own a home that you rent out as an investment property. For instance, you can deduct depreciation and HOA fees, maintenance, and repair costs. However, if you’re deducting expenses for a home you use as a primary residence, you can’t write those costs off.

Those are all things to budget for after buying a home, since some home ownership costs are rolled into the mortgage while others are not. A high yield savings account is a secure place to keep money for home expenses while earning a competitive interest rate.

What happens if you’re buying a house from family? If you’re going through a lender to get a mortgage and complete the purchase, then the fact that you’re buying from people you know shouldn’t affect your ability to claim tax deductions or credits. However, you may want to talk to a tax professional about claiming tax breaks if you’re working out a private financing arrangement with a relative.

The Takeaway

Buying a home may be at the top of your financial goals list and the more prepared you are going in, the better. Understanding how buying a house can affect taxes is important when shaping your budget, both before and after the purchase.

Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.

SoFi Mortgages: simple, smart, and so affordable.

FAQ

Is your tax return bigger when you buy a house?

Whether you get a bigger tax return after buying a home can depend on your overall tax situation, including how much you earned, how much you deduct, and what credits you might be eligible to claim. Buying a home could help to increase your refund if you’re able to deduct expenses from your taxable income, though that’s not guaranteed.

How much money do you get back on taxes for mortgage interest?

The amount of money you get back on taxes when deducting mortgage interest can depend on your total income, deductions, and credits. You can use an online tax calculator to estimate your refund based on how much interest you’re able to deduct, any other deductions you might be eligible for, and what tax credits you claim.

Does having a mortgage help with taxes?

Having a mortgage can help with taxes. Some of the tax benefits you might be able to unlock as a homeowner include deductions for mortgage interest and property taxes, as well as credits for making energy-efficient improvements. You may also be able to deduct home-related expenses or claim tax credits for homeowners.

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SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

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Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility for more information.

*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.

⁺Lock and Look program: Terms and conditions apply. Applies to conventional purchase loans only. Rate will lock for 91 calendar days at the time of preapproval. An executed purchase contract is required within 60 days of your initial rate lock. If current market pricing improves by 0.25 percentage points or more from the original locked rate, you may request your loan officer to review your loan application to determine if you qualify for a one-time float down. SoFi reserves the right to change or terminate this offer at any time with or without notice to you.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

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Loan sharks get their name from the predatory sharks of the sea, only they set their sights on borrowers in desperate need of money instead of schools of fish. Loan sharks often use threats of violence (and, in some cases, actual violence) to intimidate borrowers into paying back their loans — often at criminally high interest rates.

Loan sharks are illegitimate lenders, and even if you’re in serious and immediate need of cash, there are other options available to you.

Loan Shark Definition

So what is a loan shark? A loan shark is a person who loans money at unlawfully high interest rates and may use intimidation, primarily threats of violence, to ensure borrowers repay their debts. In some cases, a loan shark may be connected to a criminal organization or might at least imply this to intimidate borrowers.

People who borrow from loan sharks often believe they have no other options, and in fact, loan sharks might work hard to create that illusion. By lending without conducting background checks and reviewing credit reports, loan sharks also make it easier for borrowers to get money from them rather than through traditional channels.

Recommended: Guide to Financial Hardship Loans

Are Loan Sharks Illegal?

Loan sharks who use threats of violence or charge unlawfully high interest rates are breaking the law and can face criminal charges.

Though it varies by state, there are laws limiting how much interest a lender can charge on various types of loans. The maximum interest rate is called the usury interest rate — and loan sharks, by definition, charge rates higher than this.

Lenders should be licensed and, when legitimate, offer financial disclosures and have underwriting standards. Illegitimate lenders like loan sharks operate outside these requirements.

How Does a Loan Shark Work?

Loan sharks have access to a large amount of capital to offer loans to borrowers who feel like they have no other options. Rather than running credit checks and calculating a fair interest rate within legal limits based on a person’s financial history, loan sharks offer money with the threat of violence to the borrower — and their family — as an assurance that the debt will be repaid.

While we often think of loan sharks as being seedy individuals in low-lit, smoke-filled back rooms (thanks, Hollywood), in reality, a loan shark could be any individual who uses threats and intimidation to collect a debt. What’s more, any predatory lenders who charge interest rates above the legal limit are also considered loan sharks.

What Can I Do About a Loan Shark Debt?

If you have loan shark debt, the lender has no legal right to your money. They did not follow the law in lending to you, so they cannot use the law (i.e., take you to court) to ensure you pay them back.

However, they may threaten violence if you don’t pay up. And in some cases, they could follow through on that violence.

If you are concerned about your and your family’s safety, you can contact the police. Loan sharks can face both civil action complaints and criminal prosecution.

Loan Sharks vs. Predatory Lenders

A loan shark is a type of predatory lender, but not every predatory lender is a loan shark. It’s the old “all squares are rectangles, but not all rectangles are squares” lesson.

So what is predatory lending? Predatory lending broadly refers to any type of lending practice that misleads consumers to take out loans they can’t afford, often through questionable and aggressive advertising and sales tactics. Those loans are often high in fees and interest.

Unlike loan sharks, some predatory lenders — including actual financial institutions — technically operate within the law. Instead of charging unlawful interest rates, they may pile on fees, build balloon payments into a loan, convince you to purchase unnecessary products or services, or pressure less educated consumers to refinance their homes, even when it’s not in their best interest.

These lenders often intentionally target underbanked demographics and communities where there’s less access to alternative credit access. They can do this with targeted mailers, TV ads, phone calls — you name it.

Common examples of predatory loans include:

•  Payday loans

•  Auto title loans

•  Subprime personal loans

And, of course, loans from loan sharks.

Loan Shark Alternatives

No matter how dire your financial situation is, taking money from a loan shark is generally considered a bad idea. Loan sharks typically operate outside of the law and often use threats of violence to ensure borrowers pay back their loans with very high interest.

If you’re in need of money, consider your alternatives. Here are some to keep in mind:

Friends and Family

Borrowing money from friends and family is never easy, but if it means avoiding a loan shark, it may be worth asking your loved ones for help. Be prepared for them to say no, and always thank them for listening.

Personal Loan

If you can’t borrow the money from a loved one — or aren’t comfortable asking — a personal loan may be your next-best option. Depending on the lender, you can get personal loans for as little as $500 or $1,000 or as much as $100,000 or more.

Personal loan rates and terms vary. You may be more likely to get approved for a better loan if you have a strong credit score. However, if you have poor credit (more common for borrowers seeking out loan sharks), you might be stuck with personal loan lenders who charge high fees and average APRs for smaller loan amounts.

The average personal loan interest rate varies by credit score, but other factors, such as debt-to-income ratio and your employment status, can impact the APR you’re offered.

Recommended: Is There a Minimum Credit Score for Getting a Personal Loan?

Credit Card

If you have access to a credit card with a high enough credit limit — and the person or company you owe accepts credit card payments — it’s better to pay with plastic than a predatory loan.

Sure, credit card APRs can be high, and you might risk slipping deeper into credit card debt. But credit card issuers are bound by strict state usury interest rates that, theoretically, should be lower than the illegal limit set by a loan shark.

Payday Loan

Payday loans are a common last resort for people in a bind and one you may want to think twice about. While these loans often don’t require credit checks and can get you cash fast, they often come with high interest rates and other potential fees that can make them exorbitantly expensive. In fact, payday lenders often earn exceptions from state governments that allow them to charge extremely high annual interest rates (sometimes up to 400%) without breaking the law. (In that way, they’re technically different from loan sharks.)

The Takeaway

Loan sharks take advantage of borrowers who feel they’re at the end of their rope, offering loans with unlawfully high interest rates and often using threats of violence to ensure borrowers pay up. Borrowers looking for a way out may feel like they have nowhere else to turn, but there are options such as personal loans, loans from loved ones, and even credit cards.

Instead of seeking out a loan shark, consider a SoFi personal loan. SoFi offers competitive fixed rates and same-day funding. Checking your rate takes just a minute.

SoFi’s Personal Loan was named NerdWallet’s 2023 winner for Best Online Personal Loan overall.

FAQ

What is a loan shark?

A loan shark is someone who lends money to desperate borrowers at exorbitantly high interest rates, well above the legal limits. Loan sharks don’t run credit checks, which can make them appealing to borrowers with bad credit. In some cases, loan sharks may threaten — or occasionally use — violence to make sure borrowers repay their debts.

Why are loan sharks so bad?

Loan sharks are considered bad because they offer loans at unlawfully high interest rates — sometimes more than 400% — to borrowers who feel like they have no other option. They may also use threats of violence when collecting debt.

What are alternatives to loan sharks?

No matter how much money you need, there are alternatives to loan sharks that are worth exploring. Some options include asking family and friends for help, taking out a personal loan, paying with a credit card, or even taking out a payday loan, though the latter option has its own share of drawbacks.

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Photo credit: iStock/Hammarby Studios
SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

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Personal loans can provide much-needed financial assistance, but it’s important to be aware of potential scams that lead to financial loss and identity theft.

Unscrupulous lenders can hook you in by offering a loan with seemingly good terms when, in fact, you could be charged exorbitantly high interest rates and hidden fees. Scam artists, on the other hand, might take upfront fees and/or your personal information and then disappear without ever giving you a loan.

You can protect yourself, however, by understanding common personal loan scams and knowing how to identify legitimate lenders. Here’s what you need to know.

What Are Examples of Personal Loan Scams?

There are a few types of personal loan frauds that crop up with some regularity. These include debt consolidation scams, no-credit-check-loan scams, and loan fees scams. Here’s a closer look.

Debt Consolidation Scams

Debt consolidation is a legitimate way to pay off debt. It entails taking out a new loan (ideally with better rates or terms) and using it to pay off other existing loans or credit cards. There are many legitimate debt consolidation companies that can help individuals pay down their debt. And then there are scammers.

Scammers may offer debt consolidation loans that promise to lower your monthly payments and interest rates. However, they often charge high upfront fees and fail to provide the promised services, leaving you in a worse financial situation.

No-Credit-Check Loan Scams

No-credit-check loan scams target borrowers with a poor or limited credit history. There are legitimate lenders that consider factors other than your credit score, but they are likely to do at least a soft pull on your credit score (which will not affect it).

Scammers, on the other hand, often promise funds without any kind of credit check. They may ask for fees and personal information upfront and then disappear. Or, they might provide a loan but charge exorbitant interest rates.

Loan Fee Scams

Scammers may request upfront fees for processing or guaranteeing a loan. Generally, you should never pay anything upfront — it’s highly likely that your money will disappear, and you will not receive a loan. Legitimate lenders typically deduct any fees from the loan amount.

How Do I Know if I’m Being Scammed for a Loan?

Identifying loan scams requires vigilance and attention to detail. Here are 12 warning signs to look out for.

1. Phone Offers

If you receive a phone call offering you a guaranteed personal loan or unusually low interest rate, it’s most likely a scam. Reputable lenders do not cold-call potential customers. It is illegal, in fact, to make loan offers over the phone. You ‘ll want to look for lenders that advertise through traditional online and mass media.

2. Upfront Fees

While some upfront fees are charged by legitimate lenders, such as origination fees, these fees are usually deducted from the loan amount before the borrower receives the funds and only after the loan is approved. Be wary of any lender that asks for payments before providing the loan funds.

3. Wire Transfers

Scammers will often request loan payments via wire transfer. Legitimate lenders, on the other hand, typically accept payments through recognized and secure channels, such as automatic debit, online payments, or mailing a check to the lender. If you wire funds, there is no way to recover them.

4. Credit History

Be wary of lenders who claim to offer loans without checking your credit history. Trustworthy lenders typically base their loan terms on your ability to repay the loan. This involves looking at your credit, sometimes getting reports from all three major consumer credit bureaus (Equifax, TransUnion and Experian).

5. Copycat Name

Online loan scammers may use a business name or website that seems genuine. They may copy a well-known logo and website to trick you. Be sure to verify the lender’s identity by conducting thorough research online, including a lender search by name with both the Better Business Bureau (BBB) and the Consumer Finance Protection Bureau (CFPB).

6. Personal Information

Scammers will often try to get your bank account details, passwords, Social Security number, and other personal information in order to drain your checking account and/or run up charges on your credit card.

If they have enough of your personal information, they may even be able to take out loans or obtain credit cards in your name. Always check if a lender is legitimate before giving them any of your personal information.

Recommended: How to Report Identity Theft

7. State Registration

A lender or loan broker must register in the states where they do business. One way to vet a lender is to go to their website and make sure it lists the states where the company can legally conduct business. If you don’t see a list of registered states, it’s a sign the company is fraudulent.

If they do list states, it’s a good idea to verify the information with your state regulator or attorney general.

8. Reviews

It can be helpful to research the lender online and read reviews from previous customers. Genuine lenders will have positive reviews and a good reputation. You can also check the BBB’s website to see if there are complaints connected with its business profile. The BBB also has a Scam Tracker that is worth checking as well.

9. Customer Service

Reputable lenders that offer personal loans generally have phone numbers you can call and speak with a live person, rather than a chatbot. It’s a good idea to call the lender’s customer service number, ask questions, and gauge their responsiveness and professionalism. Legitimate lenders prioritize customer service.

10. Hidden Fees

Some legitimate lenders do not disclose their fees on their website; however, they are required to be transparent about fees and terms when they give you a loan offer. Be sure to carefully review loan documents for hidden fees or terms that differ from what was initially discussed.

11. Prepaid Credit Card

Scammers often request payment via prepaid credit cards. Legitimate lenders typically accept payments through secure methods, such as bank transfers or online payment platforms.

12. No Physical Address

Trustworthy lenders have physical office addresses. Be cautious if the lender only provides a PO Box or has no physical presence. If they provide an address, it’s a good idea to look it up on Google Maps or other mapping software. If their address is suspect, their services most likely will be too.

What to Do if You Are Scammed

If you believe you have fallen victim to a personal loan scam, you’ll want to take the following steps.

1. Gather Documents

Compile all relevant documents, including loan agreements, payment receipts, and communication with the scammer.

2. Contact Authorities

It’s a good idea to contact your local law enforcement — by filling out a police report, you’ll have an official record.

It’s also wise to contact agencies specializing in oversight, including your state attorney general’s office, the Federal Bureau of Investigation (FBI), the Federal Trade Commission (FTC), and the BBB. When they have your information, these agencies can better serve and protect other consumers.

3. Contact Your Bank and Creditors

You’ll want to notify your bank and credit card company about the scam. They can advise you on necessary steps to protect your accounts and finances.

4. Set Up Fraud Alerts

You may want to contact one of the three credit bureaus, Experian, TransUnion, and Equifax, and ask them to place a fraud alert on your credit report. This notifies lenders that you’ve been a victim of fraud so they can take extra measures to verify your identity when they get an application for credit in your name. You only need to contact one bureau — that bureau will contact the other two automatically.

Signs of a Legitimate Loan Company

You can be assured that a company is a legitimate lender by doing your due diligence. Here are key things to look for.

Valid Contact Information

Legitimate lenders have valid contact information, including a physical address and a working phone number.

Registered

You’ll want to make sure the lender is registered and authorized to operate in your state. You can check with your state’s regulator or attorney general.

Better Business Bureau

It’s wise to verify the lender’s rating and accreditation with the BBB. A good rating and positive customer reviews indicate legitimacy.

Good Reviews

Be sure to read reviews from previous customers to get a sense of their experiences. Legitimate lenders will have positive reviews and a good reputation.

Get a Legitimate Personal Loan

To secure a legitimate personal loan, follow these guidelines:

•  Research potential lenders thoroughly.

•  Compare loan offers and interest rates from multiple reputable lenders.

•  Read loan agreements carefully, ensuring you understand all terms and fees.

•  Ask questions and seek clarification before signing any contracts.

•  Protect your personal information and be cautious about sharing it with a lender you’re unsure about.

The Takeaway

Unfortunately, there are a lot of loan scammers out there. The good news is that you can protect yourself by familiarizing yourself with common scam playbooks and knowing how to identify legitimate lenders.

Remember to thoroughly research lenders, review loan terms carefully, and never provide personal or financial information without verifying the lender’s legitimacy.

If you’re interested in exploring your personal loan options but not sure where to turn, SoFi could help. SoFi personal loans offer competitive, fixed rates and a variety of terms. Checking your rate won’t affect your credit score, and it takes just one minute.

See if a personal loan from SoFi is right for you.

FAQ

What are some examples of personal loan scams?

There are several examples of personal loan scams to be aware of:

•  Advance fee scams Scammers ask for upfront fees before providing the loan but disappear once they receive your payment.

•  Guaranteed approval scams Fraudsters claim to offer guaranteed loans, regardless of credit history, but ask for upfront fees or personal information.

•  Identity theft scams Scammers pose as legitimate lenders and use the personal information you give them during the loan application process for identity theft.

•  Phishing scams Scammers send fraudulent emails or text messages pretending to be from a reputable lender, requesting personal and financial information.

How do I know if I’m being scammed for a loan?

Some signs that you may be being scammed for a loan include:

•  Upfront fees Legitimate lenders deduct fees from the loan amount, so be cautious if a lender asks for payment before providing the loan funds.

•  Unsolicited offers Unsolicited phone calls or emails offering guaranteed loans or unusually low-interest rates are red flags. Reputable lenders do not make unsolicited offers.

•  Unsecure payment methods Scammers often request loan payments via wire transfer or prepaid debit cards. Legitimate lenders usually accept payments through recognized and secure channels.

•  No credit check Be cautious of lenders who claim to offer loans without checking credit history. Legitimate lenders typically assess creditworthiness before approving a loan.

•  Lack of state registration Check if the lender is registered to operate in your state. Legitimate lenders comply with state regulations.

•  Negative reviews Research the lender online and read reviews from previous customers. Negative reviews or multiple red flags are signs of potential scams.

What do I do if I get scammed?

As soon as you suspect that you have been scammed, consider taking the following steps.

•  Gather documents: Collect all relevant documents, including loan agreements, payment receipts, and communication with the scammer.

•  Contact law enforcement: Report the scam to your local law enforcement agency and provide them with all the information you have gathered.

•  Contact your bank and creditors: Inform your bank or credit card company about the scam. They can advise you on necessary steps to protect your accounts and finances.

•  Set up fraud alerts: Place a fraud alert on your credit report to prevent further unauthorized activity and protect your identity and credit.

•  Monitor accounts: Regularly monitor your financial accounts and credit reports for any suspicious activity or unauthorized transactions.

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Photo credit: iStock/Moyo Studio
SoFi Loan Products
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They call San Diego “America’s Finest City” for good reason: It has year-round sunshine, gorgeous beaches, and plenty to see, do, and eat. There are parks, museums, zoos, baseball games, and vineyards waiting for you to explore.

The challenge will be narrowing down the things to do so they fit into the time you have for your San Diego vacation. But here’s help: an insider’s list of the top 10 fun things to do in this fantastic city, plus tips on planning a perfect trip.

Best Times to Go to San Diego

If you’re looking for great weather for your San Diego trip, any time of year is a good one. Temperatures are a little cooler in the winter (usually in the 60s) and can get as high as the 90s in the summer, though the average falls more in the range of high 70s to 80s.

There are a few events held throughout the year you might want to plan around:

•  January: Farmers Insurance Open (golf)

•  June/July: San Diego County Fair

•  July: Comic-Con International

•  July-September: Del Mar Racing Season

•  September: Miramar Air Show

•  November: Beer Week

•  November: San Diego Bay Wine + Food Festival

Bad Times to Go to San Diego

There really are no bad times to visit San Diego, though you will find most of the bigger events and festivals fall in the summer. The ocean water is cool throughout the year, so if taking a swim is high on your list, aim for the hotter summer months.

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Average Cost of a San Diego Vacation

If you’re already planning your San Diego trip, you’ll want to create a budget. Traveling solo? The average cost for a weeklong trip is $1,886. For a couple, that cost is $3,387.

Hotel prices range from $80 to $267 a night or higher if you like to stay in posh accommodations, and vacation rentals are $250 to 610 a night. The level of luxury you want in your accommodations, as well as whether you dine out or eat in will impact your vacation budget. (Of course, you can also find ways to save on hotel costs, by becoming a member at a hotel chain’s website and via other smart strategies.)

You can save on your trip if you use a travel rewards credit card that lets you accumulate and redeem points for rewards. You might compare credit card miles vs. cash back to see which is a better fit.

When budgeting for your trip, you’ll also want to include transportation to and from San Diego. For those who live nearby or are frugal travelers, that will mean a drive or a bus or train ride. For others, it means plane tickets.

You may also want to set aside some money for trip insurance, just in case your plans don’t unfold smoothly. You may have credit card travel insurance, or you might buy a separate policy.

10 Fun Must-Dos in San Diego

Here are some of the best things to do in San Diego, based on recommendations from locals and knowledgeable travelers, as well as popular tourist websites.

Keep in mind that San Diego has several distinct neighborhoods, including North Park, South Park, Mission Hills, Normal Heights, Kensington, and more. Each is walkable and filled with restaurants, shops, and events to keep you engaged. Now, consider this list of the best things to do when vacationing in San Diego.

1. Explore Balboa Park

Balboa Park was the setting for the 1915 Panama-California Exposition, and, since then, it has become an icon in the city. Home to the Comic-Con Museum, Fleet Science Center, Japanese Friendship Garden, Mingei International Museum, the San Diego Zoo, and much more, the park is also filled with free things to do in San Diego. You can spend hours here, exploring all of the attractions, and, since there isn’t an admission fee, this can be a way for families to afford to travel.

However, some of the specific museums will charge for entry, so do a bit of research before you head over. balboapark.org/

2. Check out the San Diego Zoo

One of the top things to do in San Diego is to visit the zoo or its sister location, Safari Park. In addition to being able to see animals like sloths, koalas, giraffes, and elephants, you can also take part in exclusive experiences that bring you up close and personal with some of your favorite creatures. Tickets are typically $61 for kids ages 3 to 11, and $71 for ages 12 and up. (Ticket prices at the separate Safari Park are similarly priced.) The zoo is usually open daily, though hours can vary, sometimes as long as from 9 am to 9 pm. Check the website before visiting. zoo.sandiegozoo.org/

3. Explore North Park

If you’re seeking things to do in San Diego for adults and you like beer, head to the neighborhood of North Park. This hipster ‘hood is in the heart of San Diego and is home to some of the best breweries in this city known for its stellar craft beer. The neighborhood is highly walkable, and you’ll also find great options for dining and shopping. sandiego.org/explore/downtown-urban/north-park-south-park.aspx

4. Raise a Glass

If wine’s more your thing, one of the things to do in San Diego for couples or friends is to visit Temecula wine country, just an hour north of San Diego. This hidden gem offers more than 50 wine varietals, including award-winning versions of Cabernet Sauvignon, Sauvignon Blanc, Merlot, Mourvedre, Viognier, Chardonnay, and sparkling wines.
Many of the wineries have on-site restaurants, and some even offer live music. When heading to this area and maybe buying some bottles to take home, consider paying with plastic and snag some credit card rewards. temeculawines.org/

5. Stroll Around the Hotel del Coronado

One of the most unique things to do in San Diego is to visit the historic Hotel del Coronado. Known as “Hotel Del” to locals, this hotel was first opened in 1888, and was the setting for the film “Some Like it Hot” starring Marilyn Monroe. Set by the sea, this iconic red-roofed Victorian resort is a fascinating place to visit.

Even if you don’t stay at the hotel, you can explore its shops, restaurants, and beach. During the Christmas holidays, the hotel is transformed into a winter wonderland, complete with outdoor ice skating rink. hoteldel.com/

6. Catch a Ballgame

Baseball fans shouldn’t miss a San Diego Padres game at downtown’s Petco Park. The season is March through October, though there are also special events and tours at Petco Park.

Dining options at the park highlight some of the best restaurants and breweries in the city, including Hodad’s, Seaside Market, and Gaglione Brothers. mlb.com/padres/ballpark

7. Hit the Beach

If getting some sand between your toes is on your must-do list for your San Diego vacation, the iconic Mission Beach should be on your agenda. Anchored by the amusement park known as Belmont Park, Mission Beach offers two miles of boardwalk if you crave a bike ride, jog, or rollerblade. The beaches (and parking lots) can fill up, especially in the summer, so arrive early and plan to stay all day.

Are you traveling with pets? Leashed dogs are allowed on the beach at certain hours, so this might be a good place to explore together.

There are plenty of places to get a cocktail or meal along the boardwalk. The dress code? Flip flops and swimsuits! sandiego.org/explore/things-to-do/beaches-bays/mission-beach.aspx

8. Sample Some Nightlife

If you’re looking for things to do in San Diego at night, Gaslamp Quarter may have what you need. Filled with nightclubs, bars (including rooftop options), and restaurants, it’s a popular scene. Whether you’re in the mood to dance, catch a comedy show, try an escape game, or hear music, you’ll find it here. gaslamp.org/

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9. See What Old Town Offers

One of the fun things to do in San Diego for all ages is visit Old Town, the birthplace of California. Filled with historic buildings that have been turned into restaurants and shops, Old Town is a great place to learn about the early days of San Diego.

There is also a “hop on, hop off” trolley tour that stops in Old Town, so you can see more of the city. oldtownsandiego.org/

10. Marvel at the Maritime Museum

The Maritime Museum, located on the Embarcadero, consists of more than a dozen sailing ships, submarines, and steam-powered ships that you can climb aboard and explore. Don’t miss the Star of India, the world’s oldest active sailing ship. Open daily from 10 am to 5 pm (last admission at 4 pm), the museum charges $20 admission for adults; $10 for children ages 3 to 12. sdmaritime.org/

The Takeaway

San Diego offers sun, fun, and plenty of things to do. It can be a great destination year-round, and whether you’re a couple in search of nightlife and wine tastings or a family who wants to spend the day at the zoo, you’ll find all kinds of amazing attractions in this Southern California city.

SoFi Travel is a new service offered exclusively to SoFi members. Earn 2x rewards when booking with your SoFi Mastercard or debit card. Then apply those rewards to your next trip when you book through our travel portal. SoFi makes planning a getaway fast, easy, and convenient — perfect for people on the move.

SoFi, your one-stop shop for travel.

FAQ

When is the best time to visit San Diego?

San Diego sees sunshine year-round, so any time is a good time to visit. However, the weather is warm but not too hot and the crowds are fewer between March and May and September to November.

What are things to do at night in San Diego?

San Diego has a robust nightlife in certain neighborhoods. North Park is known for its craft beer and restaurants, while Gaslamp Quarter is filled with nightclubs and bars.

What are things to do in Balboa Park in San Diego?

Balboa Park is home to numerous museums as well as the San Diego Zoo. It also hosts events throughout the year, including December Nights during the holiday season.

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Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

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