Merry Christmas to yourself — literally. If you close on your home in December, your first mortgage payment isn't due until February, which means you can spend January unwrapping your new house instead of writing a check to your lender. It's the best holiday gift a homebuyer can give themselves, and I'm here to show you exactly why it works.
Why closing in December means no January payment
Mortgage interest is paid in arrears — each monthly payment covers the interest for the month just finished, not the month ahead (Rocket Mortgage). At closing, you prepay the interest that accrues from your funding date through the end of that month. So a December close means December's interest is already settled at the table, and your first full payment — which covers January's interest — lands on February 1 (UCOP).
Ready to make December your month?
Here's the honest part: you're not truly skipping a payment. That extra month of breathing room simply means the interest was folded into your closing costs instead (The Truth About Mortgage). But for a buyer who just made the biggest purchase of their life, a payment-free January is a real cash-flow gift — more money for movers, new furniture, and holiday hosting in your new place.
One more reason December is a sweet time to close: the exact day matters less than you'd think. Because you prepay interest through the end of the month at closing, a mid-December signing gets the same February 1 due date as one on December 31 — so you keep that full month of breathing room no matter when you close that month (Rocket Mortgage).
Lerea Arellano — Mortgage Loan Originator, NMLS #1309362
Call or text 719-225-2201
Call or text me today to start your homebuying journey, or visit my website for more information: Lerea's website
No comments yet. Be the first to share your thoughts!