House Poor

What does a 'House Poor' mean

A house poor is a situation that describes a person who spends a large proportion of his or her total income on home ownership, including mortgage payments, property taxes, maintenance and utilities. House poor individuals are short of cash for discretionary items and tend to have trouble meeting other financial obligations like vehicle payments.

BREAKING DOWN 'House Poor'

People typically become house poor because they buy more house than they can afford, but there are other ways that people can become house poor as well. For example, some people will become house poor after the birth of a child, when one spouse decides to stay at home with the new addition, rather than going back to work.

RELATED TERMS
  1. Housing Bonds

    Debt securities issued by state or local governments to raise ...
  2. Housing Starts

    The number of new residential construction projects that have ...
  3. Home Debtor

    An individual who holds a large mortgage with little or no equity ...
  4. Housing Expense Ratio

    A ratio comparing housing expenses to before-tax income that ...
  5. Home Equity

    The value of ownership built up in a home or property that represents ...
  6. Foreclosure Prevention Act of 2 ...

    A housing act that is designed to help families keep homes that ...
Related Articles
  1. Budgeting

    Mortgages: How Much Can You Afford?

    Answering this means number-crunching as well as factoring in other considerations and expenses.
  2. Home & Auto

    Why Housing Costs Shouldn't Exceed 30% of Your Budget

    Financial experts will argue that there’s no problem with allocating 50% of your net income to housing, but that barely leaves enough money for living comfortably. Reducing housing expenses to ...
  3. Home & Auto

    5 Ways an Open House Can Actually Hurt Your Home Sale

    Open houses have long been a way to get exposure for a home that's up for sale. But it turns out it may be more trouble than it is worth.
  4. Personal Finance

    4 Reasons Why the Housing Recovery Will Be Short-lived (LOW, HD)

    Evidence would suggest that the same culprits from 2008 and some new ones are re-inflating a housing bubble.
  5. Home & Auto

    5 Mistakes to Avoid When Buying a New Home

    Learn about home ownership and some of the pitfalls a potential homebuyer faces. Understand five specific mistakes all homebuyers should avoid.
  6. Home & Auto

    4 Reasons Why Renting a Home is a Wise Decision

    We've all heard that a home is a great investment, but is it really? In this article, we will look at four reasons why renting could be wiser than homeownership.
  7. Home & Auto

    Are You Ready To Buy A House?

    There are a number of factors, aside from cost, that you should think about before buying a new house.
  8. Credit & Loans

    Buying A House? Avoid These 7 Mistakes

    Owning your own home gives you a feeling of independence that renting can’t offer, and there are big financial benefits, too.
  9. Home & Auto

    Divorce and Mortgage Payments: What You Need to Know

    Divorce can put a strain on finances, especially when it comes to the mortgage. Here is what you need to know about divorce and mortgage payments.
  10. Investing

    Are We Heading for a Real Estate Bubble?

    Housing prices across the United States have been on a steady rise over the past few years. Does this mean we are seeing another bubble?
RELATED FAQS
  1. How can a reverse mortgage help wealthy and poor retirees?

    Learn about the ways a reverse mortgage can help both wealthy and poor retirees by allowing them to borrow against their ... Read Answer >>
  2. Is there a correlation between inflation and house prices?

    There is a correlation between inflation and house prices - in fact there are correlations between inflation and any good ... Read Answer >>
  3. How does a decline in housing prices affect the banking sector?

    Learn about the affects on banks when housing prices go down, including loan delinquency rates, mortgage foreclosures, and ... Read Answer >>
  4. How do I know how much of my income should be discretionary?

    Understand the difference between discretionary income and disposable income. Learn how much of a person's income should ... Read Answer >>
  5. Is it possible to short sell real estate?

    The traditional idea of a short sale is selling something you don't have so that you can buy it back at a lower price. The ... Read Answer >>
  6. How does the law of supply and demand affect the housing market?

    Learn about the law of supply and demand, the relationship between supply and demand and how the law of supply and demand ... Read Answer >>
Hot Definitions
  1. Goodwill

    An account that can be found in the assets portion of a company's balance sheet. Goodwill can often arise when one company ...
  2. Return On Invested Capital - ROIC

    A calculation used to assess a company's efficiency at allocating the capital under its control to profitable investments. ...
  3. Law Of Demand

    A microeconomic law that states that, all other factors being equal, as the price of a good or service increases, consumer ...
  4. Cost Of Debt

    The effective rate that a company pays on its current debt. This can be measured in either before- or after-tax returns; ...
  5. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  6. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
Trading Center