Your generosity to family, friends and charities during the holiday season is much appreciated. But if you're putting gift purchases on your credit cards, make sure you've budgeted to pay them off, fast. Looming high balances can obliterate your debt-to-income ratio. Chances are your credit score will take a hit, too. Depending on the damage, these factors can affect your rate, qualification or approval.
How to avoid it? Budget your holiday spending ahead of time. Give yourself a cash budget for holiday spending and be mindful with it. Make the thought count.
Unless they're decking the halls with boughs of holly, houses often don't look their best in the winter. Days-old snow turns from crispy white to drab gray, daylight is harder to come by and curb appeal is hard to pull off.
How to fix it? It takes the same jolt of imagination to picture where your furniture would go as it takes to see your life in a house — in winter, spring, summer and fall. Before you look at houses online or in-person, spend time getting in the winter mindset. Look at wintry houses on Pinterest, Instagram, inspiration boards and real estate listings. Get in the mindset so you can see past it. As with any season: you need to see the house for what it is and imagine what it could be.
OK, here's where you do need to treat the season unlike other times of year. Winter comes with delays. There's traffic, school closings, snow shoveling. And between Thanksgiving and President's Day, there are swaths of holidays and vacations that can slow down your process with the seller, real estate agents, mortgage lenders and closing.
What to do? Be prepared. Talk to your loan officer and/or closing agents from the start to be clear on feasible closing dates. Ask what the process will look like, where to expect speed bumps and how you'll get progress updates. Most importantly, make sure you're turning in documents and staying true to your dates, too.
Plenty of homebuyers hit the winter market expecting bargain basement deals on houses. Anyone selling in winter must be desperate, right? Wrong. Sellers list during winter for countless reasons, and not all are in a rush to sell before the snow melts.
How to approach it? Like it's any other season. Sure, there won't be as much competition and you might find some great deals. But you're looking for a house, not a 60-inch TV for $199. Approaching the winter housing market like any other season will keep your expectations reasonable when searching for houses, choosing which to see in-person and how to make that offer.
(Ready to make an offer? See how prequalification can make your offer stand out.)
Same deal: sellers who list their houses in winter aren't necessarily desperate. Most aren't. Making a low-ball offer because you assume the seller will be hungry is a great way to not be taken seriously (by the seller, the seller's agent and your own agent) and to waste everyone's time.
How to handle it? Work with your agent to understand how flexible — if at all — the seller is on the price. Treat winter sellers with the same respect you would any other time of the year. Make an offer based on your buying parameters and the value of the house — not the weather forecast.
Much like walking across a frozen pond, winter househunting can be tricky if you don't watch your (mis)steps. Take advantage of the season's low traffic and holiday spirit, but keep in mind the pitfalls we've discussed above.
Not on the hunt this winter? There's no better time to think about your credit and get it prepped for spring. Tap into our 5 tips for improving your credit score.