Earlier this month, I shared what I consider to be my biggest mortgage mistake. In a nutshell, I took on a mortgage at the very top of my budget and failed to account for the fact that our costs (think maintenance and property taxes) could -- and did indeed -- climb almost immediately after we moved in.
I'm sure I'm not the only homeowner who's fallen victim to this blunder. Even if you do your research, budget wisely and think you're taking on a payment you can afford, you never know when your expenses or circumstances might change.
Now I'm not going to divulge what I pay each month for the privilege of living in New Jersey (one of the most expensive states in the nation, and the one with the highest property taxes to boot), but I will say that it's more than what the typical American my age pays. (If you're interested in learning more about the average American's mortgage payment, check out this piece by my colleague Brian Stoffel.) With that in mind, here are a few strategies I used to make my mortgage payments more manageable once I quickly realized I was in over my head.
1. Earning extra money
As a writer, I'm in the fortunate position of being able to take on extra projects to generate more income -- and that's precisely what I did when I needed additional cash to cover my mortgage payments. But even if your regular job doesn't offer much in the way of overtime potential, you can still seek out ways to earn extra.
If you're a creative professional, sites like Upwork and Toptal offer an endless stream of opportunities. You might also look into some outside consulting work in your existing field, provided your company doesn't have a problem with it (some do). If, for example, you're a salaried IT professional, you can offer up your services to small businesses on evenings and weekends.
Finally, try reaching out to seasonal businesses who need more hands on deck when things get busy. Retailers often look for extra help during the winter holidays, and if there's a local beach or pool club in the area, you could try finding weekend work during the summer months. If you're struggling to keep up with your mortgage payments, making more money is probably the easiest, most effective solution.
2. Going the DIY route
Most homeowners spend 1% to 4% of their property's value on annual maintenance and repairs. What helps us keep our housing costs to a minimum is doing as much of that work as possible ourselves. This means mowing the lawn every week, power washing our own deck once a season, and busting out the tools as needed when things inevitably break. Much of the time, you don't need to be particularly handy to tackle home maintenance yourself; you just need to be willing to put in the time. And if you are, you'll free up more cash to pay your actual mortgage.
When we moved to our home, we were quoted $1,000 per season to use a mowing service rather than maintain our own lawn. Because we already have a mower and the cost of gassing it up is minimal, we basically save $1,000 a year by not being lazy.
3. Dining at home
Before we bought our home, my husband and I used to dine out two to three times a week, at an average of $50 a pop. That all changed once we needed extra cash to pay our mortgage. Though our supermarket bills did go up, we went from dining out 10 to 12 times a month to doing so once a week, which, even when factoring in the extra groceries, saved us a good $250 to $300 per month. The typical food establishment charges a 300% markup for what it serves, so if you generally eat $300 of restaurant food each month, you're paying $200 more than necessary. If you need more cash to pay your mortgage, eliminating restaurant meals will work wonders for your budget.
If you're having a hard time paying your mortgage, it pays to use these hacks and see if any of them help. That said, if you come to realize you've just plain taken on more house than you can afford, you may want to consider moving, provided you're not underwater on your loan. The more money you spend on mortgage payments, the less cash you'll have for other important things like emergencies, college, and retirement. While being a homeowner is usually not without sacrifice, there's a limit to what you should have to give up for a place to call your own.