Strategy 35 of 107
Home sharing through a nonprofit matching program
What it is
A nonprofit home-sharing program screens and matches a homeowner with a home-seeker, often a student, worker or another senior.
Steps
- A nonprofit home-sharing program screens and matches a homeowner with a home-seeker, often a student, worker or another senior.
- Rent, help around the house, or both are written into an agreement.
- Send the rent to principal.
Repeat: Monthly.
Measure: Monthly rent received.
Try it in the calculator Enter its amount in "Monthly non-income amount to principal". Add a payoff goal of 5 years to see what is still needed.
Risks
- Living with someone new; the program's screening matters.
- Rent is taxable income above expenses.
- Check insurance and any rules on lodgers.
Who it fits
Grandmas and grandpas (62 and over), Single, Average household
Needs
62 or older; A spare room, unit or space to rent
How predictable
Depends on people or program rules (tenants, family, IRS records, lenders)
A worked example (hypothetical, not guaranteed)
Picture a hypothetical household (grandmas and grandpas (62 and over)). They owe $300,000 at 6.5% with 30 years left. The required payment is $1,896 a month, and that payment, which comes from income, never changes in this example.
They follow the steps: a nonprofit home-sharing program screens and matches a homeowner with a home-seeker, often a student, worker or another senior.
Suppose it brings $600 a month on principal from this strategy, not from the paycheck. The loan would be paid off in 16 years 3 months instead of 30 years, saving about $196,219 in interest. To finish in five years, they would still need about $3,374 a month more from other strategies. That is why the five-year sequences stack several at once.
The amount above is chosen only to show the arithmetic. It is not an estimate of what this strategy will produce for anyone. Put real numbers from the fact finder into the calculator.
Sequences that use it
- Stay-put stack for 62 and over: Lower the bills and add rent while staying in the home; right-sizing is the last step, not the first.
Sources and more information
- National Shared Housing Resource Center nationalsharedhousing.org
- NSHRC: Program directory nationalsharedhousing.org
Where to get help
- CFPB: Find a HUD-approved housing counselor (free or low cost) consumerfinance.gov
Related strategies
- 36. Landowners: a genuine conservation easement on land you keep
- 37. Rent the whole home for a big local event week
- 38. Paid family caregiving at home through a Medicaid program
- 31. Put the land to work: hunting lease, timber sale, billboard or cell-site lease
- 30. Rent out the driveway, garage, shed or attic for parking and storage
- 40. Kill the costlier debts first, then roll everything into the mortgage