Reduce your footprint. Lose the mortgage.

In 2012 alone some 1,342,489 homes were in a state of foreclosure; default notices, scheduled auctions and bank repossessions. The average foreclosure sales price? $175,872. So what does that mean?

That means a number of things the least of them being that over 1 million families were living in a dwelling they never imagined themselves in when they signed loan papers, closing notices, rent checks, and equity forms. It means that according to a 2009 report by the National Coalition for the Homeless, at least 1 in 10 homeless people had lost their homes to foreclosure. It means that change is inevitable and already overdue.

Smaller houses – tiny house trailers, earth bag homes, haybale homes, micro homes, cabins, etc – are the long-awaited, but scarcely recognized, solution for those who have become disabled due crippling mortgages and confusing lending terms. They’re also a mortgage alternative for a first time home buyer.

When we began really facing down our consumer debt, our lack of financial options, our desire for a home, and other truths, we quickly realized that small spaces + a little weekend warrior DIY could save the day. Houses built with an emphasis on need -vs- want and simplicity using creativity and inexpensive plans (think rectangle rather than octahedron), translate a lower mortgage. In some cases (as in ours) it means building a small house with no mortgage at all. As Charles Ingalls would say: “cash-on-the-barrel.” Micro homes, if you will, assist in minimizing the major expense of a mortgage or building a house without a mortgage by cutting back on what is excess (like often unused square footage in the home) and focusing on dual purpose items and well-appointed spaces.

But even beyond that small homes mean freedom. What my wife and I figured out is that I was working 60 hours a week so that we could afford a home oversized for our needs, save for a new car that was larger than we could fill, shop at places to buy things we already didn’t have room for, and the list goes on. A small home would minimize our overhead. Minimizing our overhead and reassessing our needs and wants would allow me to cut back on hours at work; hours that could be devoted to our family. There is an obvious exponential pattern in reducing your footprint. Finding a solution that reduces large and overwhelming debt can only bring more financial ease and joy to your life.

Let’s review.

Why avoid a huge home loan or mortgage?

  • Income from a job is not guaranteed. In today’s economy of constant lay-offs and downsizing no job is absolute.
  • The purchase price of a house multiplies anytime the banks want to increase the interest rate. That equals an uncertain payoff schedule.
  • Financial strain and problems cause relationships to fracture, or even disintegrate entirely, from the stress.
  • Want to go on vacation or out-of-town a few times a year? Impossible. The bank still needs payment which means more working in order to pay off a mortgage debt for the next 30+ years.

And this is just the tip of the iceberg. This doesn’t even account for how carbon footprints can be shrunk by working less, living in less, consuming less, etc. If the work week could be cut to four full time days that would be one more day of car-free living (no fuel used, no exhausted emitted, no oil burned). If your home is the size you need you spend less on heating/cooling, less on furnishing, and less on raw materials (which tend to exhaust natural resources and poison our planet).

Where do I find out more about small homes?

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3 comments on “Reduce your footprint. Lose the mortgage.

  1. You know, living in a moderately large home has its ups and downs, ins and outs. We live minimally to a certain extent, meaning that we don’t take lavish vacations, buy expensive items, and try to keep up with the Jones’.

    My wife and I have come to the realization of reducing our carbon footprint by revamping how we live in our home and on our postage stamp property. We have taken up gardening, food preservation by canning and freezing, cooking from scratch as much as possible with the goods we grow. We share our earth grown goods and preserves with friends, family, and neighbors. And I can tell you that a few folks in my local community have or are starting to follow suit. It just makes too much sense these days.

    We may be locked into the so-called American Dream, but we are taking steps to learn how to reverse the tragedy of mortgage-ship.

    Nice post. Glad I stumbled across this blog post today. You are spot on on this one.

  2. Great and concise discussion of a very relevant issue! Love the idea of looking around and feeling like what I have is “enough” rather than feeling stressed about needing more. Thanks Andrew!

  3. I’m so excited to see some of those home plan sites you added. Thanks!!