Category Archives: homesteading

A Guide to Help You Pay for your Homestead

In this post,I hope to provide you with some guidance in how to pay for that homestead you have dreamed of owning. You may be one of the lucky ones with a wealthy relative or you just happened to win the lottery. Like many of us, you are looking for those alternative ways to pay for it and make your homesteading work. The goal of my wife and I are to pay for what we will need to make it a reality by saving money and paying cash. We will indeed have some monthly payments involved, however, we want to keep those at a minimum. It really defeats the purpose of giving all of your hard earned money to corporate interests. Who really wants to have a never ending mortgage or high interest rates.

You always have the option of going to a Commercial lender and borrowing the money. That will only result in up to a thirty year mortgage, with most of your payments being interest. The downfall in commercial lending is that never-ending mortgage, high down payment requirements, mandatory insurance and property taxes. I am certainly no financial expert in these matters, but I can certainly see the writing on the wall and want more for my homestead while spending less to get there.

The Rural Housing Loan Options-

Your first option is always paying for everything in cash by saving. If you cant quite get there and your homestead is rural, try a US Department of Agriculture (USDA) Rural Housing loan. They have two loan programs available depending on where you live. The first is the Single Family Direct Housing Loan, also known as a Section 502 Direct Loan. These are loans directly from the Department of Agriculture and you deal directly with them, and loans are based on your income level and ability to repay. They also require either a low or no down payment and the interest rate is much lower than a commercial lender. Another positive is that you do not need a perfect credit rating or credit score. First, you will need to submit a pre qualification form to determine if you qualify.

They also have the USDA Guaranteed Housing Loan which are loans through a participating lender that are guaranteed by the USDA. In these you may see a higher down payment requirement and the credit score may be higher. Each area will have different income requirements. The link below will also give you a search function to learn if the programs are available in the area you may be interested in. Without repeating the nuts and bolts of their programs, here is a link to their site and offerings.

http://www.rd.usda.gov/programs-services

Earn While you Homestead-

Perhaps you have a desire to have your homestead pay for itself. Ideally,we would all be able to make our homesteads pay for themselves right away, but it doesn’t always work like that. I will list for you several ways to get started in paying for your homestead.

1. Get out of debt and stay out of debt……

Pay off all those credit cards and other bills as fast as you can. As with us, even if you have a small mortgage on the property itself, you can pay extra each month without a prepayment penalty and pay it off sooner rather than later. If you stick with it, you can pay it off in 15 years instead of 30 years.

2. Buy Used….

This goes along with the whole idea out of staying and being debt free. As much as possible, pay only cash for things you buy, especially equipment. You may end up buying an old truck or tractor and spend some time making minor repairs or upgrades on them. In the end, you don’t have an enormous payment or any glamour. It can make it worthwhile in the end. I will stress not to compromise safety in the interest of buying used. It’s not a wise idea to purchase used electrical panels, wiring, or receptacles for your home or shop. Most applications will require an electrical permit if you are a Do It Yourselfer. Think about the safety of you and your family!

The concept of buying things second-hand goes beyond just vehicles– Some are yard sale fanatics and purchase a large number of clothes, household items, and kitchen stuff that way. If you are just beginning, yard sales are a great way to find items that you may need. Its also a great way to sell many items you want to get rid of.

3. Become a DIYer….

I am fortunate that I was able to learn many skills to be able to do things myself. Some were learned from others and many I learned myself, by doing them myself. I have been able to complete electrical, plumbing, woodworking, carpentry, landscaping, and welding. These skills will become invaluable when building our homestead. Sometimes local laws require hiring professional contractors to complete tasks like electrical installation, and its unavoidable. You too can learn these skills and complete many of the same tasks. For a nominal fee many local Community Colleges offer courses and certifications in these areas. It may cost you in the beginning, however, in the long term you will have the knowledge that will last much longer.

4. Barter When You Can….

Whenever you can, barter for goods and services. You may have skills that someone else may be in need of, and they may have something you really need for your homestead. Many people will be happy barter with you to save some money. I have known people who traded electrical work for tractor work. Some will happily trade farm animals for other animals. People will always barter food and produce. Much of this also depends on your location and whats available. Check local advertisements through websites, newspapers, and social media sites.

5. Be Creative with Small Income Streams…

Like many, I eventually hope to have a small income from this blog alone. Many others are creative and find ways to make money on sites like Ebay and Craigslist. Ebay mostly consists of buying, selling, and shipping. Craigslist provides the same opportunity but keeps what you are buying and selling more local. Income can be made but use caution with Craigslist and meeting people in person. Handmade items,if you are artsy and creative, are great ways to make some extra money!

If you want to use your homestead to make money, many grow vegetables for their own consumption, while some sell their excess at a local farmers market. My wife and I plan to grow our own organic vegetables and start raising our honeybees again once things are settled on our homestead. Raising chickens and selling eggs are an additional source of income for your homestead.

You can find through most ads people wanting some type of service or work done. If you lack the expertise in some areas, consider getting the training that you need. You can always write off the expense of the training on your taxes, along with the investment in equipment and supplies. Remember that some areas like electrical, plumbing, and heating and air require a license to operate as a business.

There are many other ways to generate income and pay for your homestead and its up to your creative imagination to get there! Happy Homesteading!

 

 

 

A Place To Call Home!

A Place to Call Home….How to find it?

Many people look for that perfect place to find and call it home. I hope to help you along the way in finding that perfect spot just for you. My wife and I spent quite a bit of time looking for property and deciding where our homestead would be. We insisted on a place where we could end up with some peace and serenity, yet be able to build our homestead where it would be functional, yet affordable.

We decided that we wanted to purchase where the land was affordable, the costs were less, and we could spend that extra money on our homestead and cabin and not worry about giving most of it to Uncle Sam.

We wanted to have the freedom to roam our property, decide what we wanted to do and not worry with overburdening regulations. We wanted something quite different from the daily traffic grind, neighbors on top of each other, HOA’s, mounting urban regulations, and increasing property taxes.

We decided to try our luck with the mountains of Tennessee.  Everyone has their choice of where they would prefer to be and that’s okay. Perhaps you want to be near family again or that a certain area appeals to you. For us, we chose the high ground of Tennessee to start our search. Why? It came down to the desire for mountain property, the experience of a change of seasons, the land was affordable, and taxes were much less than surrounding states.

We began by taking a short vacation to the Volunteer State and the Great Smoky Mountains. We rented a great little cabin for two days near Greeneville Tennessee, while we had made arrangements to meet with a Land Specialist later in the week to look at property. After looking at several pieces of property in the Cumberland Plateau, we decided to continue to explore this great state and enjoy the family vacation.

After our return home, we decided to evaluate our options and decide what we wanted to do. Do we decide on a purchase or don’t we?  Where would we be happy at!  We eventually decided on purchasing five acres near Crawford Tennessee. We could spend time clearing the property ourselves and decide where each little piece had to go. We spent over a year deciding and making plans, as well as making payments on the property. After a year of planning we purchased our new camper and decided to head back to the property and “get to work”. Well, that was short lived!

In the interest of getting to the good stuff with helping you find your way and get started, I’ll just ask you to visit my wife’s blog at www.cheriannjones.com and find out what happened!  She will also appreciate the visit!

Finding Your Property-

Whether you want one half acre or 100 acres, first decide where and why you want to live there. There are many choices in finding property. Perhaps a family member or an acquaintance has property they will let you settle your homestead on. Many properties can be expensive and many can be affordable. Finding a realtor is an option, but remember, the idea is to save money and spend less. Realtors are in the business to make money, and some have high commission fees. Very few of them deal in rural homesteading property. We decided to search for property using alternative methods like internet searches and Craigslist Ads for private owner financing property for sale. Be careful while using this method since the property may be affordable and the size you want, however sometimes the land is just not usable for building or homesteading. To give you an example, the first property we found we contacted the owner, and decided while In Tennessee we would go look at it. The price was right, the size and the location were good, but the property was straight uphill, and We mean uphill.  You can’t farm it much less build anything on it.

We finally found a Land Specialty Company located in Tennessee. They have a no thrills website, yet told you enough to get you interested. They are owner financing, and have useable property in most size and price ranges. The great thing is they finance with a low down payment, military and veterans discount, and reasonable monthly payments. If for some reason you aren’t satisfied with your purchase, you can return the property to them or trade for another. Best of all, if you purchase from them, and make a referral, and they purchase, the company will waive one of your monthly payments. No bank will do that for you!

Here is the link in case you are interested!   www.countryplacesinc.com

Once you have found your land-

A good place to start is the county or city tax collectors office. You can easily research online to find most information about any parcel of land. The people selling you the property can also be valuable in providing this information, but don’t always rely on that either.  Double check the information on your own just to be sure. Most tax collectors offices can tell you how much taxes you will be paying annually on the property and whether a title search has been done. Title searches can tell you whether the property is free and clear of any liens or other issues. Most of the local government sites have an online database to search for property or parcel information. If you can’t find it online, call them. Many times you will only need a physical address and an owner name.

You can also contact the city or county government and obtain the contact information for the local utility companies serving that area. You will need that information before you purchase to know whether that property has available water, sewer, and electric service. While purchasing our first piece of property we took our realtors word for it that all of these services were readily available and close to the property. We found out different, and I don’t want you to make that mistake too. Double check everything!

We easily had electric at the corner of the property, however, we found much later that the nearest water line was about a half mile away.  We didn’t want the added expense to run that much water line to the property. Well water would have been another option but that can get expensive in drilling and pumps. And, there’s no guarantee the company drilling will find water. If you want to try your hand at well water, be sure to check with any neighbors who have been there for along time.  Most of the “old timers” can tell you whether it’s worth it or not! Who knows!  If you happen to find property in the mountains, a spring fed water source can be valuable if one is on the property.

While we are at it, be sure to look closely at the property boundaries on a survey map. Any property being sold will have a map drawn by a licensed surveyor. Pay  careful attention to the boundaries.  During our search we found that the neighbors property line included a roadway adjacent to our property, which we had initially planned to use for driveway access. This can make a big difference in right of way access or not. That owner was not willing to grant a right of way along this route, and we found access at the main road was not possible without additional expense because it washes out during heavy rains. This was the deciding factor, for us, in trading the property for another. The Land Company was more than willing to do that for us. Many people, like us, search for land that we want to eventually use for gardening, raising poultry or livestock, or replacing our honeybee hive. We wanted a “homestead” with as few restrictions as possible. Many areas have dwelling size restrictions, requirements on connecting to water and sewer, and keeping or having farm animals. That was one of our requirements in searching for property to have some minimum restrictions. In our case, the final property we purchased only required a minimum square footage of 650 square feet of living space. There were very few restrictions on domestic farm animals, only that we can’t engage in commercial operations.  That was not an issue for us as our only interest was for personal use and consumption. You can find many codes here at www.municode.com

The three most important things in choosing your future homesteading property is to (1) Walk the boundaries and get a layout of the land. The boundaries, especially if mapped by a surveyor, will be clearly marked. (2) Do your research on utilities and access to the property before making a commitment to purchase (3) decide if you can afford it and that the property is adequate enough to do what you want to do with it. Most areas have some type of building codes and restrictions to deal with.  The areas we chose in Tennessee, especially the rural areas, have very few restrictions except for electric and sanitary waste disposal. These are safety issues and expected almost everywhere requiring permits and inspection. You really don’t want someone else’s waste seeping into your ground water do you?

Disposing of Waste-

Many people choose homesteading for the freedom to live as you want to live without any restrictions or interference.  You have choices almost anywhere when deciding how you want to dispose of waste, especially human waste. I wrote about composting toilets in a previous blog and how they work. Many states and locales allow composting toilets with certain requirements. In our case, they are allowed as long as the toilet is certified by the manufacturer as meeting certain standards, and the property has running water, meaning, a public water system.  In our case, we are choosing an in-ground approved septic system. Our process was fairly easy from the percolation test to finding a licensed contractor. The first step after deciding on our property was to have it “ perc” tested, or Percolation test. In Tennessee, in urban areas you are required to obtain a permit through the County or City health department. In rural areas, permits are obtained from the State of Tennessee. Once we submitted the application and paid the required fees, the Inspector came out and conducted the on-site test. It took about 30 minutes.  The “perc test” simply tests the soil for absorption of liquids into the ground from the septic system drain field. Most of the solids remain in the main tank and need to be pumped out by a licensed disposal contractor who disposes of the solids properly.

If you are required to have an approved septic system, it is worth the minimal investment. Some will not want to spend the money and self dispose of their waste, but, that’s something I wouldn’t recommend over long periods of time. Many areas obtain their drinking water from underground aquifers and these contaminants seep into the ground into those water sources. We chose a 1000 gallon lowboy septic tank which is more efficient and the installation is less work for the contractor, especially if the ground has rock. Removing rock is an added expense. Be sure to check with your local health department to learn what is required and the process.  It can get very expensive if not followed properly. Disposal of waste is a safety issue for everyone!

Electric or Solar-

While many homesteaders would prefer to go off-grid and get their electricity from solar power, it can get quite expensive. While the solar panels get their energy from the sun, that energy needs to be stored somewhere for use, and that’s usually in the form of batteries. What you use the energy for can determine how large your system needs to be. Some areas give tax credits for solar installation while some utilities even buy the energy from you. Honestly, the return they can give you isn’t all that great but it’s better than nothing I suppose!

We would probably use solar at some point as a backup in the event the power went out or use it to power other low demand sources for our homestead. For now we will use the local power company.  When choosing the local power company, or in our case, the only choice was a local Electric Membership Co-Op. Personally, I would prefer them, because customers are voting members and have a say in the direction and operation of the company. Many times they are cheaper with their rates and service.  Not everyone will have that ability and will be stuck with some of the major power providers.  One of the Engineers with the local Co-Op met us and gave us some good information about what needed to be done to get power to our property. It was a positive experience and they seemed happy to work with us to make that happen.

We did find that we needed to contact the adjacent property owner to get permission to trim some limbs on their property to run the power lines to ours. The neighbors agreed!  The only cost to us will be around $100 .00 to have the limbs trimmed. Not a bad expense at all!

Stay Tuned!  In my next Blog post I will provide you with creative ways to help pay for your Homestead!

 

Happy Hunting!