How can I raise finance to build a home for my family
As I see it, there are 2 potential solutions - Joining with another person or 2, and buying a house with multiple bedrooms. I am in the US, and I've seen immigrants living in tight accommodations that would seem unacceptable to most of us. But, with the combined incomes, they were able to buy the house and quickly pay for it, and then buy another.  $800/mo is about $5/hr. Below US minimum wage. Use your skills to take on additional work on line. A virtual assistant position can increase your income quite a bit.  Keep in mind, as someone on the other side of the world, my advice may not be practical for you, these are just my thoughts. Wanting save enough money to purchase a home is an issue that a lot of people face, regardless of where they live. The most simple answer is to save, save, save. Create a budget so that you are able to track every dollar. After you do so for a few weeks, then you will be able to see exactly how your money is being spent and where you can cut costs. If you need to, pick up a second or third job in your spare time. Then you can contribute your salary from that to your savings. If possible, consider moving in with friends or family - paying them rent of course, but it might be cheaper than renting on your own (you might also consider exchanging house work for rent). Times might be lean when you are saving, but you should remind yourself of what the ultimate goal is.  I am unfamiliar with the government policies in Pakistan, but perhaps there is some kind of housing relief program where you can relocate to temporarily? Your situation is unfortunate and I sympathize with you. Best of luck!
what are my options for raising the funds? Assuming you have decent credit, you can either mortgage your home or apply for a land loan in order to purchase the land. Since both your home and the land have value, either one can act as collateral in case you default on your loan. Land loans tend to have a higher interest rate and down payment, however. This is because banks see land loans as a riskier investment since it's easier for you to walk away from an empty plot of land than your own home. "I am going to respond to a very thin sliver of what's going on.  Skip ahead 4 years. When buying that house, is it better to have $48K in the bank but a $48K student loan, or to have neither?  That $48K may very well be what it would take to put you over the 20% down payment threshhold thus avoiding PMI. Banks let you have a certain amount of non-mortgage debt before impacting your ability to borrow. It's the difference between the 28% for the mortgage, insurance and property tax, and the total 38% debt service.  What I offer above is a bit counter-intuitive, and I only mention it as you said the house is a priority. I'm answering as if you asked ""how do I maximize my purchasing power if I wish to buy a house in the next few years?""" "If you want to have your wife stay home with kids, you'll have to make a plan to get there. As you point out, your situation right now won't support this. Create a budget that will work for you with a single income -- a ""zero based"" budget, not a budget based on your current expense structure. Figure out what you can afford on just your income for housing, church, food, transport, etc. Or apply the same idea on the assumption that she will keep working -- budget based on a second income plus child care expenses. Then you can decide what you have to change in order for that to work: maybe it means selling your house, renting, relocating, selling a car, finding a better or second job, etc. Then decide what you need to do in order to make these changes." Let's think like a real estate developer. First you need to check with the zoning commission the restrictions for the area. Let's say that the plot is actually suitable for 10 homes. You buy the land. You also need to finance the build itself. If you don't have enough cash you need to acquire financing from banks and perhaps from other sources as well, because banks won't loan you the entire amount.  Next you need to divide the plot into 10 pieces, making sure that each piece has driveway access to the street and plan access to utilities (water/sewer/electricity/broadband/phone lines). Plan the size and position of each house. Get building approval. This is a process that can take some time, especially if they have follow-up questions. Get a builder to build the houses, including ground work and preparation for utilities. Get approval for the finished houses. A building inspector will check that the houses follow the permission and all laws and regulations that apply. This step can entail time and added cost.  Get a real estate agent to sell the new homes. Often, the selling process starts in the planning phase and early buyers are able to influence both the layout of the house and the finish. Your cost estimate included a profit of 140k for each house. From that a builder needs to subtract financing costs, real estate agent costs, any costs that you forgot to factor in, budget overdrafts, contingency costs, and salaries for your staff and yourself. I estimate the project time to 1.5-2 years. So, we have an $8M project with a gross profit of $1.4M (not including all costs). Net profit probably just a few hundred thousand. Or less.  Real estate developers with local knowledge would be able to make a much more accurate estimate on both time and cost. My guess is that they have, and since the plot hasn't sold in a while, either the price is at the upper end of what makes a profitable project or there are other restrictions that limit the number/size of homes that can be built on it. All of RonJohn's reasons to say no are extremely valid. There are also two more. First, the cost of a mortgage is not the only cost of owning a house. You have to pay taxes, utilities, repairs, maintenence, insurance. Those are almost always hundreds of dollars a month, and an unlucky break like a leaking roof can land you with a bill for many thousands of dollars. Second owning a house is a long term thing. If you find you have to sell in a year or two, the cost of making the sale can be many thousands of dollars, and wipe out all the 'savings' you made from owning rather than renting. I would suggest a different approach, although it depends very much on your circumstances and doesn't apply to everybody. If there is someone you know who has money to spare and is concerned for your welfare (your mention of a family that doesn't want you to work for 'academic reason' leads me to believe that might be the case) see if they are prepared to buy a house and rent it to you. I've known families do that when their children became students. This isn't necessarily charity. If rents are high compared to house prices, owning a house and renting it out can be very profitable, and half the battle with renting a house is finding a tenant who will pay rent and not damage the house. Presumably you would qualify. You could also find fellow-students who you know to share the rent cost. "I see two important things missing from your ongoing costs: maintenance and equipment. I also don't see the one-time costs of buying and moving. Maintenance involves doing some boring math like ""roofs go every 20 years or so and a new roof would cost $20k, so I need $1000 a year in the roof fund. Furnaces go every 20 years and cost $5k, so I need $250 a year in the furnace fund."" etc etc. Use your own local numbers for both how long things last and how much they cost to replace. One rule of thumb is a percentage of the house (not house and land) price each year keeping in mind that while roof, furnace, carpet, stove, toilets etc all need to get replaced eventually, not everything does - the walls for example cost a lot to build but don't wear out - and not all at a 20 year pace. Some is more often, some is less often. I've heard 5% but think that's too high. Try 3% maybe? So if you paid $200,000 for a $100,000 house sitting on $100,000 of land, you put $3000 a year or about $250 a month into a repair fund. Then ignore it until something needs to be repaired. When that happens, fund the repair from the savings. If you're lucky, there will always be enough in there. If the house is kind of old and on its last legs, you might need to start with a 10 or 20k infusion into that repair fund. Equipment means a lawnmower and trimmer, a snow shovel, tools for fixing things (screwdriver, hammer, glue, pliers, that sort of thing.) Maybe tools for gardening or other hobbies that house-owners are likely to have. You might need to prune back some trees or bushes if nothing else. Eventually you get tools for your tools such as a doo-dad for sharpening your lawnmower. Well, lots of doo-dads for sharpening lots of things.  One time expenses include moving, new curtains, appliances if they don't come with the house, possibly new furniture if you would otherwise have a lot of empty rooms, paint and painting equipment, and your housewarming party. There are also closing costs associated with buying a house, and you might need to give deposits for some of your utilities, or pay to have something (eg internet) installed. Be sure to research these since you have to pay them right when you have the least money, as you move in." You are doing great! Congratulations. Check out the Dave Ramsey Baby Steps.  He has advice for exactly your situation. The book Financial Peace covers the topic in detail.  You have an Emergency Fund which is Step 3.  Step 4 is investing 15% for retirement in 401k and similar.  Step 5 is funding college if you have children. In Step 6, he advises putting any extra money towards the principle on your home.  Owning your own home outright is a better goal than investing the money at a higher interest versus your mortgage interest rate. After your are completely debt free, then you can invest and give generously which is Step 7. Answering your question, push your emergency fund to 6 months, bump your retirement saving to 15% and put any extra money to your mortgage. Do you want a house?  Sounds like you do.  Did you think about what it will take to own a run a house?  I am betting you have.  Buying a home shouldn't be about an investment in anything other than you happiness and you sure seem conscientious and ready. Your worries are good ones, but don't forget about unemployment insurance, that as responsible people you can get another job.  Do you have a life insurance policy?  If you really really can't afford your payments, you can try to sell the house because you should have plenty of equity per your plans. Furthermore, chances are you will earn more in your paychecks over your lifetime.   Think about what features you want, shop the market hard, take time and buy a house on reason rather than love.  Don't you dare love the house until you buy it. Owing money to family members can create serious problems. Taking out a purchase-money mortgage to pay your sister for her share is the best way to avoid future friction and, possibly, outright alienation. Your question has an interesting mix of issues. ASAP and 3-4 years doesn't feel like the same thing. ASAP results in bad decisions made in haste. Four years of living very frugally can create a nice down payment on a house.      A car is only an investment for Uber drivers and those who are directly financially benefitting from a car's use. For everyone else, it's a necessary expense.  What I'd focus on is the decision of buying a plot of land. Unless this is a very common way to do it in your country, I don't recommend that order. Having land and then trying to finance the building of a house has far more complexity than most people need in their lives. In my opinion, the better way is to save the 20% down, and buy a new or existing home you can afford.  In the end, spending is a matter of priority. If you truly want to get out in the least time, I'd save every dime I can and start looking for a house that your income can support. "Outside of broadly hedging interest rate risk as I mentioned in my other answer, there may be a way that you could do what you are asking more directly: You may be able to commit to purchasing a house/condo in a pre-construction phase, where your bank may be willing to lock in a mortgage for you at today's rates. The mortgage wouldn't actually be required until you take ownership from the builder, but the rates would be set in advance. Some caveats for this approach: (1) You would need to know the house/condo you want to move into in advance, and you would be committing to that move today. (2) The bank may not be willing to commit to rates that far in advance. (3) Construction would likely take far less than 5 years, unless you are buying a condo (which is the reason I mention condos specifically). (4) You are also committing to the price you are paying for your property. This hedges you somewhat against price fluctuation in your future area, but because you currently own property, you are already somewhat hedged against property price fluctuation, meaning this is taking on additional risk. The 'savings' associated with this plan as they relate to your original question (which are really just hedging against interest rate fluctuations) are far outweighed by the external pros and cons associated with buying property in advance like this. By that I mean - if it was something else you were already considering, this might be a (small) tick in the ""Pro"" column, but otherwise is far too committal / complex to be considered for interest rate hedging on its own." Debt will ruin any plans.  I guess that the interest on the credit cards is about $450 a month or about $5,500 per year and the school loans is about $6,000 a year.  Get a an Excel spread sheet going and start tracking your expensed.  Learn to make a amortization spread sheet for all debts, and any future debts that you are thinking about. If you want a family soon plan on one income for a period of time. If you buy a house plan on paying it off while you are working.  Then the house payment becomes spendable money during retirement.  A cheaper house can be upgraded in the right neighborhood with an excellent appreciation in value.  Money put into excellent collectibles and kept for 20 years or more is private and off the radar income no taxes when sold. STUDY STUDY LEARN LEARN There is no simple, legally reasonable, way for her to build equity by helping out with your mortgage, without her having a claim to your mortgage. The only 'equitable' thing she can do is rent from you.  If you want her to be building equity, have her start and fund a brokerage account for herself. If you have an affinity for real estate, have her buy REITs in said investment account. "Your actual question is a bit confusing, but parts of it are answerable. If your parents give you cash to buy a home, you use it for a cash sale, and you then repay them, then if they don't charge you interest (above and beyond any they may pay - treat their loan as entirely separate from yours.) that amount of not-charged interest is considered a gift.  You can look up these rates here, on the IRS website, called ""Applicable Federal Rates""; currently it's around 2.30% APR.  If the interest is that much, the interest isn't a gift, but part of a loan - though your parents will have to file some paperwork and you will also.  Search for more information about ""Intra-Family Loans"" for full details - and talk to a real estate lawyer. Separately, if your parents are the primary/only signors on the mortgage, and are thus effectively the property owner, there are two separate issues.  First, you're welcome to pay off the mortgage while you live there, and no tax issues exist (then) in terms of gift, though it's still owned in your parents' name - so you don't get the house, they'd have to gift that to you separately, though they can do that in stages to avoid gift tax ($14k worth of equity per year, or whatever the current year's annual limit is, per parent and per you/wife if applicable). H&R Block discusses the concept of Equitable Ownership, which determines who is able to take the property tax and mortgage interest deductions on the house.  Tax Almanac goes into a bit more detail on the subject.  Ultimately, another issue for a real estate attorney probably (or at least a CPA or tax attorney): you need to be very careful if you're going to try and get the tax deductions (which would be probably far more than the savings of a half percent of interest rate or whatnot).   In general, there are a lot of options for exactly how you structure the purchase, payments, and equity, and you should talk to a professional to find out exactly the right way to structure it.   This mortgage info site has some good tips for several different ways to structure things, just as an example. I would in particular suggest you pay attention to deductability of mortgage interest and property taxes, as those two can be a huge amount of tax savings and you can lose that very easily if you're not careful." This solution obviously wouldn't work for everyone, and is contingent on the circumstances of your parents' finances with regards to their house, but...  Have you considered buying your parents' house?  This way your parents' desire for you to get a house as an investment would be satisfied, they wouldn't have to worry about losing their home, and you might even be able to work out a financing/rent deal that is beneficial to everyone involved.  There are definitely fewer costs going this route anyway, for instance, your parents won't have any marketing costs associated with selling the house and could pass this savings along to you.  Also, having lived in the house for a large part of your life you will also know what you are getting in to.