Avoid These Winter Home Buying Missteps

Purchasing a home is a very complex financial transaction.  There are many factors to consider to ensure the transaction closes successfully.  These basic principles still apply even in the slower winter months.

Your loan officer may have “preapproved” you for a home loan this past summer.  But, keep in mind that the lender will still ask for more current financial statements before they give final loan approval.  Don’t make any major purchases like a car or run up the balance on your credit cards.  And, don’t quit your job and take a new job.  Lenders like to see seasoned, verified income.  This can hurt your credit score and skew your financial ratios to the point that the lender decides to not give final approval for your loan.

Make sure you factor in all the costs of homeownership.  The closing costs and down payment will deplete some of your savings.  There will also be preventive maintenance, property taxes, homeowner insurance, and possibly HOA dues.  You will probably also spend money to personalize your home with: a fence, garage door openers, blinds, a deck, and necessary lawn care equipment.

Many buyers lose their enthusiasm once summer is over and figure they should just wait until the spring to resume their home search.  There are actually advantages to purchasing a home in the winter.  There is less competition from other buyers and sellers marketing their home for sale in the winter tend to be very serious about selling.  So you may have a little more leverage during negotiations.

I purchased my first home the week before Thanksgiving back in 1994.  I remember the sellers being pleasantly surprised they had any showings and a solid offer right before Thanksgiving.  The negotiations were very clear cut since the buyer and seller were serious about the transaction.  Keep your eyes open, you just never know when that perfect home will come on the market.