Now this can be a tricky subject. After all, many articles along this line are going to tell you a very different story. They are going to tempt you with ideas like pulling money out of your home loan or reverse mortgaging, but these are far riskier than their actual payoff. Of course there are exceptions to every rule, but for the vast majority of people, these are two options that are probably a very, very bad idea.
So what are a few more realistic ways to get some money out of your home? Read on folks, as we’ve made a rather useful list.
1.) Rent out a room. Renting out a room is one of the easiest ways to cut down on your living expenses. Not only will a monthly rental payment take a decent chunk out of your mortgage payment, but the cost of utilities should also be decreased (since you have another person paying for a portion of them). And while most people don’t like the idea of their privacy being compromised, an extra person around the house certainly has other benefits besides those from a financial standpoint. They can help pick up around the house, there’s someone there when you head out of town that can water the plants, collect the mail and keep an eye on the pets. Of course this goes both ways; you should probably offer to feed their goldfish should they leave for a few days.
2.) Rent out your entire home. Moving back home after you’ve already purchased a house? Maybe you need to be close to family or are trying out a new job offer. Paying two mortgages is never really an option for anyone (let’s be honest), but if you can rent out your previous home for a price that covers the mortgage payment, you might be able to keep it for the time being. Just make sure you have adequate tenants though, as a wild group of college kids will more likely do more damage than anything in the presence of an absent landlord.
3.) Energy tax credits. There are quite a few energy tax credits established in 2011 that will be continued throughout 2013, at least. Alternative energy investments in your home (like solar panels, for example), should give you at least a small percentage of money back. And you’re helping the environment. Win-win.
4.) As a tour hot-spot. If your home has something special about it (Abraham Lincoln lived there when he was 15, it’s one of the oldest known homes in the continental United States, it’s haunted), you might be able to use it to your benefit. Although the idea of giving tours of your home may sound tacky or unrealistic, many people use this as an alternative form of income. Check your local state guidelines to see what you can do.