(NewsNation) — The dream of owning a home can quickly turn into a nightmare for those who take on more financial burden than they can handle. The trap is so common it has a name: house poor.

The common definition of house poor is having a mortgage or rent payment that is too high relative to one’s income, cash flow or net worth. The result: having almost no money for anything but the house payment and other home-related expenses like utilities, HOA fees and maintenance.

A Chamber of Commerce study last year pegged the percentage of “house poor” households in the U.S. at more than 27%.

“It’s best to limit your total monthly housing obligations to no more than 30 percent of your gross income,” said Greg McBride, chief financial analyst for Bankrate. 

“In pricey markets and for young renters and homebuyers, that may seem impossibly constraining,” McBride said. “Those with steadily rising incomes may feel comfortable going above that threshold with the belief that their rising incomes will allow them to ‘grow into’ the payments in a year or two. But this is not without risk, so tread carefully.”

How to avoid becoming ‘house poor’

Financial experts say the best way to avoid becoming house poor is to buy low: determine the maximum mortgage for which you qualify, then find a home that is far less expensive.

But if you’re already up to your neck in payments, the experts offer some options to ease the pain:

• Increase your income. Think about a second job, look for a new higher-paying job, or ask for a raise from your current employer.
• Consolidate other debt. Credit cards and other revolving debt could be bundled to create a lower monthly payment. But you’ll pay a larger total amount over the life of that consolidation loan.
• Use your savings. As painful as that may be, it can be far less painful than missing a mortgage or car payment.
• Limit discretionary spending. That’s perhaps the most painful step, especially when the time you might be spending out on the town is instead spent inside your house.
• Refinance. Falling interest rates might free up some money each month. Also, if you took out a 15-year mortgage, think about switching to a 30-year loan, which would significantly lower your monthly payment.
• Sell. If all else fails, you may have to consider leaving your dream home and downsizing. But you’ll be trading that dream for financial peace. And maybe you’ll again be able to afford one or two nights on the town.