A friend of mine was to close on her house in mid Jan, and now the builder (new build) says that they can complete the house and have her close by the 31Dec. I am questioning this as more than any kind of goodwill gesture from the builder! What would be the builder's/mortgage co's advantage to closing in Dec vs. Jan? According to her, her disadvantage is that if it is Dec, her 1st pmt is due Feb 1, and if the close is Jan, 1st pmt is due Mar. Do they just want to capitalize on 1 more pmt in 2004? Any thoughts???
They probably don't care about when her payment is. I suspect the builder wants the sale completed so the property is not "in his inventory" at the end of the year. In some states, companies are taxed on inventory on hand at the end of the year. Or maybe he needs the completed sale to make his balance sheet look good. But I suspect it's for business reasons of the builder.
Whatever the reason, it is probably in your friend's interests to close in January, since a late December close virtually guarantees that any tax deductible expenses at closing will be lost (points, odd days interest and property tax apportionments) if this is a first house, since the Standard Deduction will probably be larger than the itemized deductions. Witha January close, itemizing is virtually guaranteed.
