What You Didn’t Know About Home Loans

A home loan, otherwise known as a mortgage, enables you to purchase a house without paying the full price out of pocket at the time of the purchase.

For most people, buying a home is the biggest financial transaction of their lifetime. For that reason, if you’re in the market for a new home, it’s best to learn all you can about home loans and how they work before you get too deep into the process.

Here are some things you may not know about home loans:

Rates fluctuate daily

Borrowers who are eager to secure a home loan with a low interest rate may get into the habit of checking mortgage rates as often as some people check the weather. Interest rates fluctuate every day, which means the rate you see today may be different than the one you see when you actually are approved for the loan.

The cheapest interest rate does not guarantee the cheapest loan

When choosing a lender, borrowers will often choose the one offering the lowest interest rate, but this can actually be to their detriment. There are other factors to consider, including closing costs and the lender’s policy on releasing equity for a line of credit or a loan. Also, in adjustable-rate mortgages (ARM), the loan featuring the lowest interest rate may not have the lowest rate a few years down the line and may actually cost more in the long run.

A fixed-interest rate mortgage can ultimately cost you more

When interest rates are low, many home-buyers choose a mortgage with an interest rate that is fixed throughout the life of the loan, believing it is the most cost-effective choice. This may or may not be correct. A fixed-rate mortgage might comes with higher exit fees, or fees paid to the lender when the loan is repaid. Also, if rates drop further throughout your loan’s term, you won’t be able to take advantage of the new rates unless you refinance. Finally, interest rates on fixed-term mortgages are generally higher than the initial rate on ARMs.

A lower credit score can cost you tens of thousands of dollars in interest

Most people know that a higher credit score is generally awarded with a lower interest rate, but not many people know to what extent this is true. A high credit score can translate into tens of thousands of dollars in interest payments over the life of a home loan. A credit score difference of 100 points can increase a monthly mortgage payment by $150 or more, depending on the size of the loan and the interest rate.

If you’re thinking of applying for a home loan soon and your credit isn’t in the “very good” category (higher than 740), it may be worthwhile to spend a few months working to boost your score before you apply for a mortgage.

The housing market impacts rates

While the federal funds rate will have the greatest impact on the rise and fall of interest rates, the state of the housing market will affect it, too.  Lenders need to turn a profit from their loans, which means the higher the volume of loans they process, the less they need to earn from each one to remain profitable. Consequently, when the housing market is booming and lenders are granting loans on a frequent basis, they will be more inclined to offer lower interest rates to borrowers.

You can have your mortgage payments automated

Your home loan payments will likely be your largest monthly bill, and missing a payment or paying it late can have serious consequences. Fortunately, you can avoid these scenarios by signing up to have your monthly mortgage payments automatically deducted from your checking account. Most lenders provide this service; check with yours to see if this is an option they offer.

Buying a home will likely be the biggest purchase you ever make. Be sure to find out all there is to know about mortgages and their interest rates before applying for a home loan.

Your Turn: Do you have another lesser-known fact about home loans to share? Tell us about it in the comments.

Learn More:
kloze.com
wyndhamcapital.com
binvested.com
bankrate.com

Saving on Landscaping

For the green-thumbed homeowner, there are few things as pleasurable as running fingers through soft, moist earth, catching sight of the first flowering buds of spring and inhaling the scent of freshly cut grass.

Tending to a lawn and garden can get expensive. Between seeds, fertilizer and gardening supplies, costs can be high enough to take the pleasure out of lawn care.

Here are 10 creative ways to save on landscaping, so you can have your well-tended lawn and your budget, too.

1. Plant perennials

Go green with your garden by choosing plants that flower year after year. You’ll have to pay more out of pocket when you first plant these blooms, but the cost-free plants you’ll have each year will more than make it worth the price.

2. Make your own compost

Mulch and other soil products may keep your garden healthy, but they’re not as kind on your wallet. Save money by going the DIY route with compost. All you need is a designated outdoor bin to collect your old fruit and veggie peels, plant clippings and dead leaves. After a few weeks, you should have a pile of nutrient-rich soil ready to give your garden the boost it needs to grow and glow.

3. Grow and trade

For a colorful variety of flowers, plant perennials that grow and multiply quickly, like hostas or daylilies. Within a few years, you should have more of these flowers and plants than you need. Then, you can trade them with friends and neighbors for new and interesting plants.

4. Propagate your plants

Grow your garden by helping your plants propagate. You can do this by separating an already growing plant into two and replanting; rooting a leaf or rooting a small stem with leaves. You can propagate new plants in soil or in water. Find out more about propagating here.

5. Choose plants that are natural to your region

For lower-maintenance plants, choose species that grow naturally in your area of the country. You’ll save on extra watering, soil correction and special plant food.

6. Shop the end-of-season sales

The plants in the nursery and home improvement store won’t look too attractive in the fall, but that doesn’t mean they’re useless. Plants that look wilted now can grow beautifully in the spring, as long as the roots are alive and well. Best of all, you can score these healthy plants at bargain prices.

While you’re shopping during the fall sales, you can pick up discounted potted plants, planters, gardening tools, lawn chairs and more.

7. Leave your grass clippings

Looking for an easy and cost-free way to improve your lawn? You already have one! Just leave your grass clippings on the lawn after mowing instead of cleaning them up. The clippings will break down quickly, adding organic matter and nutrients to your grass.

8. Don’t cut your lawn too short

Shorter grass attracts more weeds and will need more herbicides. Higher grass will shade out those pesky weeds while also developing a deeper root system, thus requiring less watering. Keep your grass at 2- 2 ½ inches for best results.

9. Pay attention to pH

It’s important to measure and control the pH level of your lawn. If the ground is too acidic or alkaline, your plants and grass won’t absorb nutrients, no matter how much fertilizer you feed them. Ideally, pH levels on lawns should be between 6.5 and 7. If your lawn’s pH level is too high or too low, you can add lime or sulfur to correct it.

10. Save extra flower seeds

Bought too many seeds to plant this year? No worries; you can save them for another year! Most flower seeds will keep well if stored in a cool and dry place. You can even buy seeds in bulk with plans to save the extra for a more cost-effective purchase.

Gardening is fun and rewarding — and it doesn’t need to cost a lot of money. Use our tips to cut back on landscaping costs without compromising on the health of your lawn.

Your Turn: How do you save on landscaping costs? Share your best tips and tricks in the comments.

Learn More:
bhg.com
houzz.com
www.policygenius.com

What Do I Need to Know About Today’s Real Estate Market?

Q: The news from the real estate market can be confusing. What do I need to know as a buyer, a seller, or just an American citizen, about today’s real estate market?

A: Trends and stats in real estate are constantly changing, especially during the unstable economy of COVID-19. Here’s all you need to know about the real estate market today.

Is it a buyer’s market right now? 

Actually, pickings are slim for home-buyers right now, giving sellers the upper hand and driving up prices for buyers. According to the National Association of Realtors (NAR), inventory was down nearly 20% in October 2020 compared to October 2019.

Low supply also means homes are on the market for a shorter period of time than what would be likely in other years. According to the NAR, in October 2020, more than seven out of every 10 homes sold were on the market for less than a month. This means buyers don’t have the leisure of lingering over their decisions and may find themselves getting caught in heated bidding wars.

If you’re currently in the market for a new home, it’s best to be prepared to change some of the items on your list of must-haves into nice-to-haves. You may also want to expand your search to include other neighborhoods or home types than you originally planned. And of course, don’t forget to have your mortgage pre-approval in hand before beginning your search. This will give you a leg up on bidding wars and show sellers you’re serious about buying.

What does low inventory mean for sellers?

An uneven balance of supply and demand that favors sellers means homeowners who are looking to sell will have more offers than anticipated. They may be able to choose the best offer for their home — perhaps even at a price that is higher than expected as well.

If you’re selling your home right now and have plans to purchase another, remember that the things making it easier for you to sell your home in this market will also work against you when you purchase a new one. Prepare for prices that may be above market value and a pressured buying environment.

Is home equity up? 

According to the NAR, home prices have swelled to a national median of over $300,000, with October 2020 marking 100 consecutive months of year-over-year price gains. CoreLogic’s 2020 3rd Quarter Homeowner Equity Insights report shows that the average U.S. household with a mortgage now has $194,000 in home equity. These factors make it a great time to sell a home.

If you’re selling your home, it’s a good idea to work with an experienced agent to ensure you get the best possible offer for your home.

If you’re planning to buy a home in this market of increasing home prices, make sure to work out the numbers and to determine how much house you can afford before starting your search.

If possible, consider choosing a 15-year fixed-rate conventional mortgage, which will give you the lowest overall price on your home.

Are interest rates still low? 

Interest rates reached record lows in 2020 and economists are predicting low rates continuing through 2021.

For buyers, this helps make homes more affordable. However, it’s important not to let a low interest rate make you think you can afford a home containing a price tag that is really out of your affordability. As mentioned, be sure to run through the numbers and determine how much house you can really afford before you start looking at houses.

How is the home-buying process different right now? 

Many parts of the home-buying process are now being done virtually due to COVID-19 restrictions. Some sellers are only offering virtual tours to only very serious buyers. Other parts of the process, like the attorney review and the actual closing, may be done completely virtually using remote online notarization and electronic signature apps.

What do I need to know about the real estate market if I don’t plan to buy or sell a home this year?

According to Freddie Mac, equity will likely continue to rise in 2021. But it will be at a more controlled pace. You may want to monitor how much your home is worth this year since you may change your mind about selling before the year is up.

Similarly, if you’re a homeowner with no plans to move, this can be a great time to tap into your home’s equity with a home equity loan or line of credit from Advantage One Credit Union. Contact us at 734-676-7000 or shoot us a line at news@myaocu.com to find out more.

Your Turn: Have you bought or sold a home recently? Share your best tips with us in the comments.

Learn More:
daveramsey.com
rockethomes.com
keepingcurrentmatters.com

Am I Really Ready to Buy a House?

Young black couple signs paperwork with agentQ: I’ve saved a down payment, narrowed my choices of neighborhoods and drawn up a wish list of what I’m looking for in a home, but I’m getting cold feet. How do I know if I’m really ready to buy a house?

A: It’s perfectly normal to feel hesitant about going through with what may be the biggest purchase of your life. To help put you at ease and to make sure you’re really prepared for this purchase, we’ve compiled a list of questions to ask yourself before buying a new home.

Can I afford to buy a house?
Before viewing properties, remember that purchasing a new home will cost more than just the down payment. Buyers also need to cover closing costs, which typically run at 2-4 percent of the total purchase, as well as moving costs, and possibly new furniture and renovations for their new home.

Can I afford the monthly mortgage payments?
Most lending companies will grant a loan to a home buyer if the monthly mortgage payments do not push the buyer’s debt-to-income (DTI) ratio above the recommended 43 percent. This means that the total monthly debt the buyer carries, including their mortgage, credit card, loan, and car payments, do not exceed 43 percent of their monthly income. You may want to work out the total for your pre-mortgage debt before applying for a loan so you have an idea of how much house you can afford.

When determining whether you can actually afford your monthly payments, though, remember that there’s more to home ownership than a monthly mortgage payment. Be sure to include calculations for taxes, insurance and a possible increase in utility bills. A mortgage lender should be able to provide some of these numbers for you.

Am I ready to settle down?
The average length of time that homeowners in the U.S. live in a house is only seven years. Buyers who don’t plan on staying in their homes long-term may end up incurring a loss. Consider factors like your career, family planning, changing demographics of a neighborhood and more when trying to answer this question. Experts advise buyers to only purchase homes they plan on living in for a minimum of five years.

Does buying a house in my neighborhood make financial sense?
Many Americans view home ownership as a rite of passage into adulthood, but that doesn’t mean purchasing a home always makes financial sense. In some neighborhoods, rentals are relatively cheap while houses sell for far more than they are actually worth. In these neighborhoods, buying a home may not be the logical choice, even if the buyer can easily afford the purchase.

Is my credit score high enough?
A fairly decent credit score is necessary to qualify for a home loan. Most lenders will only grant a home loan to borrowers with a credit score of 650 or higher. A score that doesn’t make the cut can be increased by being super-careful about paying all bills on time, not opening new credit cards in the months leading up to the home loan application, paying credit card bills in full each month and keeping credit utilization low.

Do I have a plan in place for repairs?
When a renter has a leaky faucet, they call the landlord and the problem becomes theirs. When a homeowner has a leaky faucet, it’s their own problem. They can either fix it or hire someone to do the job, but it’s a good idea to have a plan in place before the first thing in a new home needs fixing. If you’re handy enough to handle repairs on your own, you’ll need to be ready and willing to give up some of your free time on weekends to tend to things around the house. Otherwise, it’s best to have a tidy sum put away to pay for necessary repairs before purchasing a home.

Sometimes, an appliance or a system in the house will be broken beyond repair and will need replacing. Homeowners need to have enough money stashed away in their emergency fund or rainy-day account to cover these purchases, too.

Buying a first home is an exciting milestone that only happens once in a lifetime. If you think you’re ready to take this step, first make sure this purchase is the right choice for you at this time on a financial and practical level.

If you’re ready to get started on your home loan application, click or call to hear about our fantastic home loan options.

Your Turn:
How did you know you were ready to buy a house? Share your thoughts with us in the comments.

Learn More:
investopedia.com
thebalance.com
rubyhome.com
creditsesame.com
moneyunder30.com

Should I Refinance to a 15-year Mortgage?

Middle-aged man and woman work at a laptop to figure out their mortgage paymentsWith mortgage rates holding and a booming economy, lots of homeowners are rushing to refinance their mortgages to lock in low rates. One increasingly popular option is to refinance a conventional 30-year mortgage into a 15-year loan.

Borrowers may be wondering if this is a financially sound move to make for their own home loan.

We’ve researched this option and worked out the numbers so you can make a responsible, informed choice about your own mortgage.

When refinancing can be a good idea
The primary attraction to a shorter mortgage term is paying off your home loan sooner, typically at a lower interest rate. This can help you increase your home equity faster and can mean paying thousands of dollars less in interest over the life of the loan. Therefore, refinancing to a shorter-term loan makes the most sense when interest rates are falling.
It’s also a particularly good idea for homeowners who can easily afford to increase their existing monthly mortgage payments. In addition, homeowners whose home values have increased since they financed their original mortgage will be more likely to qualify for a 15-year loan, since they will have a lower loan-to-value ratio —how their home’s current value compares with their current loan balance.

How much money can I save?
There is no quick answer to this question, as there are several variables at play in each refinance. To provide a basic idea of what a shorter-term home loan can mean for your finances, let’s take a look at how the numbers would work out in a 15-year refinance on a conventional home loan.

As mentioned, a 15-year loan generally carries a lower interest rate than a 30-year loan. If national interest rates are falling when you refinance, and/or your credit has improved since you bought your home, your interest rate can be even lower. According to Bankrate’s most recent survey of the nation’s largest mortgage lenders, on Dec. 6, 2019, the benchmark 30-year fixed mortgage rate was 3.74 percent and the average 15-year fixed mortgage rate was 3.16 percent.

Let’s assume you refinance your fixed $300,000 mortgage with an interest rate of 4.5 percent to a 15-year loan at an interest rate of 3.5 percent.

If you kept your existing mortgage unchanged for 30 years, you’d be making 360 payments over the life of the loan at $1,520.06 a month, not including taxes, insurance and other fees.

Toward the beginning of the loan, an overwhelming majority of your monthly payment will go toward interest, with less than $400 going toward your principal. By the time you pay off your loan, this ratio will reverse itself and the majority of your payments will go toward the principal of the loan. Most importantly, over the life of your loan, you will have paid $247,220.13 in interest.

Now let’s explore what these payments would look like if you refinanced this loan to a 15-year fixed-rate loan at a 3.5 percent interest rate.

Over 15 years, you would make 180 payments of $2,144.65. Over the life of the loan, you’d be paying $86,036.57 in interest payments, bringing significant savings of $161,183.56. You’d also be chipping away at your principal at a far quicker pace, with $1,269.65 of your very first payment going toward the principal of the loan.

If these numbers are exciting you about getting your refinance process started, take a step back and slow down. First, these numbers may or may not translate directly to your own situation. In the above example, savings are calculated over 30 years, but you may be nearing the halfway point of your 30-year mortgage. A refinance can still be a good idea if it can get you a lower rate for the remainder of your loan, but your interest savings will be significantly less than those described above. Second, your interest rate may not be a full point lower after a refinance, as it is in our example. This, too, will afford you less savings.

There are other crucial factors to consider before jumping into a 15-year refinance. Read on for a review of some of the more important variables to think about when making this decision.

What will a refinance cost?
Refinancing your mortgage is not cost-free. Expect to pay a minimum of 2.5 percent of your new loan in closing costs and other fees.

Here are some of the possible fees you can expect during the refinance process:

  • A fee for pulling your credit
  • A fee for processing your paperwork
  • Lawyer fees
  • An inspection fee
  • Discount points, each of which are equal to one percent of your home loan, which will give you a lower mortgage rate
  • An appraisal fee
  • A surveyor fee
  • Title search fee
  • Title insurance

Before you get started on the refinance process, it’s a good idea to tally up these expenses and see how much it would cost you to refinance.

You might be offered the option of refinance at no cost. This means your closing costs will be rolled into your new mortgage payments. This can make financial sense if it means saving money in the long term, but it’s a good idea to work out the numbers before you continue with the process.

Finally, your existing mortgage may have prepayment penalties, which can cut into the amount you’ll save by refinancing. Find out about these fees before you set the refinance process in motion.

When refinancing to a 15-year mortgage is not a good idea
If you’re convinced that a 15-year refinance is right for you, make sure to consider this crucial factor before going ahead with the refinance: Your monthly mortgage payments will increase significantly after a 15-year refinance. In the example above, the mortgage payments increased by $624.59 a month. Your own payments may see a similar change, and any increase will impact your finances.

If you’re financially responsible, you won’t consider this move unless you are confident you can afford to meet this increased mortgage payment. However, you may not realize that tying up your spare cash in your home’s equity can be a risky move. It can make more financial sense to first build an emergency fund with 3-6 months’ worth of living expenses, and to increase your retirement contributions. If you’re carrying any high-interest debt, you’ll want to pay that down, too, before moving ahead with a refinance.
Increasing your monthly mortgage payments can mean leaving you with a tighter monthly budget and very little breathing room. Make sure you are fully prepared to swallow these costs before you go ahead with a refinance.

Are you ready to make the move to a shorter-term loan? Speak to a representative at Advantage One Credit Union today to learn about our fantastic home loan options.

Your Turn:
Have you refinanced to a 15-year mortgage? Tell us about it in the comments.

Learn More:
.bankrate.com
money.com
mybanktracker.com
themortgagereports

All You Need To Know About Home Loans

Close-up of a mortgage application on a desk with a pen and keys on top of the applicationHere at Advantage One Credit Union, we provide a variety of products and services to meet your specific financial needs and in the most ideal ways possible. One such example is our home loans. Let’s take a closer look at this product and how its application process works.

What is a home loan?
A home loan, or a mortgage, enables you to purchase a home without having to foot all the cash out of your pocket when purchasing. You will, however, need to make a down payment, which is typically between 3.5-20% of the home’s appraised value, along with closing costs and some other fees. The lender then finances the rest of the purchase. You’ll repay the loan, along with interest, over the course of (generally) 15 to 30 years.

Are all home loans alike?
Before you get started, you’ll need to choose a mortgage type. A conventional loan will necessitate a 5-20% down payment on the home. There’s also an FHA loan, which only requires a down payment of 3.5%, but necessitates mortgage insurance. If you’re a military veteran, consider obtaining a VA loan, which lets you buy a home with zero down payment.

Once you’ve chosen the kind of loan which is best for your scenario, you may be given a choice of repayment arrangements for that loan. Here are the three common types of mortgages:

  • 30-year fixed-rate mortgage
    The interest rate on this 30-year mortgage will remain fixed no matter the changes to the national rate.
  • 15-year fixed-rate mortgage
    This mortgage will also have a fixed interest rate, but the term lasts just 15 years. The monthly payments will be higher, but the overall interest paid over the course of the loan will be significantly lower.
  • Adjustable-rate mortgage (ARM)
    An ARM gives the borrower a lower interest rate in the early years of the loan, and then a gradual increase (adjustment) in rate over the rest of the life of the mortgage.

What do I need to know before applying for a home loan?
A home is likely to be the largest purchase you will ever make. To qualify for one, you will need to prove that you are living a financially responsible life and that you can afford the monthly payments.

The primary way lenders gauge your financial responsibility is through your credit score. This number is like a grade that tells lenders how you’ve handled your past credit card accounts and other debts. It will include the length of time you’ve had your credit cards and loans open, the timeliness with which you’ve made your payments, the trajectory of your debt and the amount of available credit you might use. Most lenders will only grant a home loan to borrowers with a credit score of 650 or higher. You can check your score for free on Credit Karma. You might also consider ordering a free credit report from all three major credit bureaus once a year at AnnualCreditReport.com.

During the time leading to your mortgage applications, make sure to pay all your bills on time, don’t open new credit cards and work on paying down overall debt. A higher credit score will help you get approved quicker and it will net you a lower interest rate on your loan.

Another crucial factor in determining your eligibility for a mortgage is your debt-to-income ratio, or your DTI. Lenders want to know how big your collective outstanding debt will be in relation to your income if you receive the home loan. Most lenders will only allow a maximum DTI of 36%. Here at Advantage One Credit Union, we allow our members to take out a home loan with a DTI of [XX%].

When should I apply for a home loan?
While you won’t need the loan until you are ready to close on a house, it’s a good idea to start the process before you begin house-hunting. Your lender will let you know whether you can expect to be approved for a loan and will provide you with an estimate of how much house you can afford so you don’t face disappointment later.
When initially applying for a home loan, ask your lender for a letter of pre-approval. This letter confirms you are pre-approved for a home loan up to a specific amount. Having this letter in hand shows real estate agents and sellers that you are serious about buying. Most pre-approvals are only good for 60-90 days, so make sure you’re ready to start house hunting before you get yours.

How do I apply for a home loan?
To apply for a home loan at Advantage One Credit Union, stop by and ask a representative to help you get started. Make sure all of your financial paperwork is in order and hold onto all important financial documents in the months leading up to your application.

To make it easier, we’ve created a list of the information and documents you’ll need:

  • Name of current employer, phone and street address
  • Length of time at current employer
  • Official position/title
  • Salary including overtime, bonuses or commissions
  • Two years’ worth of W-2s
  • Profit & loss statement if self-employed
  • Pensions and Social Security check stubs
  • Proof of child support payments
  • Copies of alimony checks
  • Statements for all checking and savings accounts
  • Investments (stocks, bonds, retirement accounts)
  • Proof of any gifted funds from relatives
  • Car loan information

You will also need to explain any blemishes on your financial record; including bankruptcies, collections, foreclosures and delinquencies.

If you’re ready to apply for a home loan, stop by Advantage One Credit Union today. We’re completely committed to your financial success.

Your Turn:
How did you prepare for a home loan application? Share your tips with us in the comments.

Learn More:
thebalance.com
rubyhome.com
thelendersnetwork.com

Should I Buy A House During The Holidays?

Close-up of the front of a Colonial style house with a navy blue front door decorated with holiday wreath.Q: I’m in the market for a new home and wondering if I should push off my search until after the holidays. Is it a good idea to buy a new home during Christmas?

A: While spring and summer tend to see the highest volume of home sales, it doesn’t mean they’re the only time to buy a house. Let’s take a closer look at some of the myths and lesser-known facts about timing the purchase of a home and explore the pros and cons of buying during the holidays.

The myth about buying in the spring
Contrary to popular belief, springtime can be the worst season to purchase a home. While the longer daylight hours do make it easier to check out the exterior, shopping for a new house during the hottest real estate season can mean facing all kinds of drawbacks and difficulties.

First, and most importantly, sellers tend to mark up their prices when they see heightened demand for their homes. Also, the flooded market can lead to expensive bidding wars with buyers who are also interested in the same property. Plus, if your search is successful and you find a new home during the spring, the closing process can drag out much longer than necessary as title companies, inspectors and movers may not be able to service you in a timely manner during their busiest season of the year.

Why Christmas can be a better time to buy
Shopping for a home during the winter, and especially during the holidays, offers the following advantages:

  • Homes are priced to sell
    Most of the houses you’ll find on the market during the late fall and early winter will be holdovers from the spring and summer season. At this point, homeowners may be desperate to sell and get their property off their hands. Alternatively, the houses may have just been put on the market because of the owner’s sudden and urgent need to relocate due to unforeseen factors like a job change, divorce or another life-altering event. In either case, the owner is looking to sell quickly, and will likely be more willing to compromise on their original asking price than homeowners selling in the spring and summer. In fact, according to The Wall Street Journal, home prices can drop to a 12-month low in December.
  • Holiday spirit makes people more agreeable
    People tend to be in a more generous frame of mind around the holidays. Let this factor work in your favor by shopping for a home during the holiday season. You can walk away with a dream home at a dream price, and you may even be able to negotiate some extras, like furniture or a fresh coat of paint, into the selling price.
  • Fewer buyers on the market
    With more people looking to relocate during the spring and summer months, you’ll have less competition when house-hunting around Christmas time. This will give you an edge in bidding wars and it will make it easier for you to negotiate to bring down an asking price on a home.
  • Professionals of the field are more available
    December is usually the slowest month of the year for home sales. This can work to your advantage if you choose to buy a home around the holidays. Your real estate agent will likely have plenty of time to show you around since fewer other people are looking to buy during this season. The various professionals you’ll need to hire during the home-buying process-including an attorney, home inspector, underwriter and mover-will likely be able to service you promptly as well.

Before you go house hunting
While buying a house during the holidays can be a great idea, keep these factors in mind before you give your agent a call:

  • Daylight hours are short during the winter, giving you a small window of opportunity to search.
  • You won’t be able to see a home’s property in its full glory during the winter months.
  • Some sellers may not be too keen on throwing their homes open to viewers during the holidays.
  • Unexpected inclement weather may delay some parts of the home-buying process, like the inspection or even the closing.
  • You’ll have fewer homes to choose from when house-hunting during the winter, as a cooler real estate market means slimmer pickings.

Shopping for a new home during the holidays may not be conventional, but it can mean finding your home sweet home quickly, easily and for a far better price.

If you’re in the market for a new home, make sure to stop by Advantage One Credit Union to ask about our home loan options. We’ll help you move into your dream home with the most favorable terms.

Your Turn:
Have you bought a home during the holidays? Tell us about it in the comments.

Learn More:
fitsmallbusiness.com
thebalance.com
freddiemac.com
loans.usnews.com
blog.nationwide.com
thebalance.com
realestate.usnews.com