You may be in the midst of paying off your mortgage. Maybe you’ve come to realize that when you’re done paying off that mortgage, you’ll have paid a bank a lot of money just to have that mortgage. You may have kids or hope to have kids one day and you wish your kids wouldn’t be enslaved to this same bondage to a bank. With some creativity and hard work, you can help to provide a mortgage-free life for your kids.
On occasion, you hear about parents who give a house to their child as their wedding gift. What a generous gift! What rich parents! That kind of generosity seems so far away, but maybe it’s not. Maybe it’s more about planning than the money.
1. Gifting a House
A mortgage on a house could be 15, 20 or 30-year terms. After 15 or 20 years of paying the loan, then the house is then debt-free. Children are typically at home for 18-21 years, about the same length of the loan. But for most families, to pay the mortgage payments on top of all of life’s other expenses would be impossible. How about having someone else pay those mortgage payments for you? Renting out a house could be the answer to having a home to give to your kids.
Some questions to ask yourself:
Are there any starter size homes in your area that are for sale?
Is there a rental market in your area? Are people looking for houses to rent?
Do I have enough for a downpayment on a second house?
Could the rent pay for the mortgage and a little extra for repairs?
Could you see yourself as a landlord?
note: This same method could be used to build equity in real estate for future retirement.
2. Purchasing or Building a Tiny House
There is an increasingly popular movement where people are rejecting the previous generations believe that the bigger the home, the better. Young people are choosing to live in very tiny, but nice homes, to avoid the “rat race” and live mortgage free lives.
These tiny homes cost a fraction of what most homes cost and can be built in a matter of months. Many of these tiny homes are built on a trailer so that they can be transported to different locations.
Could a tiny house be the solution to a mortgage-free life for your children? If your child goes away to college, could a tiny house significantly save on the cost of rent or room and board? And then after college, could a tiny house continue to save money on rent or a mortgage while money is saved so that a house could be paid for in cash?
An additional side benefit: If parents are willing to take on this project with their high school children, in preparation for leaving the nest, it could provide a great bonding experience, great memories, and a learning experience that would benefit them and prepare them for life.
For more information about either purchasing houses to rent or how to build a tiny house, explore the subject on YouTube.com. There are many informational and interesting videos available.
