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Best Loans And Tips For Home Buyers With Disabilities

6-Minute Read
Published on February 12, 2021

Homeownership can be an important part of the American dream as a way to build wealth for the long-term and create stability in your finances. Although many would-be home buyers are under the misconception that buying a home is out of reach for people with disabilities, that could not be further from the truth.

In fact, there are many home loans for people with disabilities. We’ll explore the options and share some tips on how to successfully secure the home loan you’re looking for.

An Overview For First-Time Home Buyers

Before we dive into the specific home buying programs for adults with disabilities, it’s important to gain a better understanding of the home buying process. Luckily, there are countless free resources available through Rocket Mortgage®.

I would recommend starting your research into the home buying process here:

After you’ve taken the time to learn more about the home buying process, you’ll be better prepared for the future.

Apply for a Mortgage with Quicken Loans®

Apply online for expert recommendations with real interest rates and payments.

Start Your Application

Home Buying Programs For Adults With Disabilities

Next, we’ll take a closer look at the specific home buying programs available for adults with disabilities. One will likely suit your needs.

Fannie Mae

Fannie Mae, otherwise known as the Federal National Mortgage Association, is a government-run organization that provides affordable housing opportunities. Although you cannot directly receive a loan from Fannie Mae, you can secure one through a mortgage lender that is guaranteed by Fannie Mae.

If you’re interested in qualifying for this type of loan, you’ll need to have:

  • A credit score of 620 or higher
  • A debt-to-income ratio of less than 50%
  • A down payment between 3% – 5% ready
  • 2 or more months of mortgage payments saved

Although there are some loan limits based on your area, this could be a great option for adults with disabilities that have a lower income.

FHA Loans

FHA loans are often presented as a great option for anyone with a lower credit score. Since these loans are backed and insured by the FHA, borrowers can access lower down payment options.

You’ll need to have a credit score of at least 580 or higher and a low debt-to-income ratio. If you’re an adult with a disability and have a low credit score, an FHA loan could be a good option.

USDA Home Loans

The USDA, U.S. Department of Agriculture, offers a home loan program that could be good opportunities for adults with disabilities.

The Housing Guaranteed Loan Program is designed for single-family homes. Through this program, low-income applicants that live in eligible rural areas can qualify for a home loan.

In order to qualify for a loan directly from the USDA, you’ll need to show that you don’t have access to clean housing and cannot obtain a loan from other lenders. Separately, you can get a USDA loan through and lender with zero down payment if you qualify. If you can qualify for the loan, then you’ll need to use this property as your primary residence. Rocket Mortgage® does not offer USDA loans at this time.

VA Loans

If you’re a disabled veteran, a VA loan could be the perfect fit. In order to qualify for a VA loan, which is guaranteed through the Department of Veterans Affairs, you’ll need to meet military service requirements.

If you meet the required service, the other requirements for obtaining the loan are relatively relaxed. For example, there is no minimum credit score requirement set by the VA or limits set on your debt-to-income ratio. Although lenders will set their own requirements, these will likely be more relaxed than the requirements of a conventional loan.

Rocket Mortgage® has a minimum median credit requirement of 580 for VA loans.  

State Agency Assistance

Beyond federally backed loans, many state agencies also provide home loan opportunities for adults with disabilities. Although the assistance and requirements will vary based on the state, it can be a good option to look into.

A few states that offer assistance to adults with disabilities seeking homeownership include Maryland’s Homeownership for Individuals with Disabilities Program and Connecticut’s Home of Your Own Program.

In addition to home loan programs, many states offer property tax exemptions to people with disabilities. Contact your local tax collector to see if there is an opportunity to save.

Nonprofit-Supported Loans

Government programs are not the only option for people with disabilities seeking homeownership. Luckily, there are several nonprofit-supported loans through many organizations, including:

In addition to the national nonprofits above, seek out local organizations supporting people with disabilities in your area.

Tips For Home Buyers With Disabilities

The home buying process can be a challenge for anyone. However, there are many ways to create a smooth home buying experience.

First, Know Your Rights

As a person with a disability, it’s important to understand your legal protections when shopping for a home. You can explore your protection through the help of the National Disability Rights Network and the American Bar Association.

Unfortunately, it’s possible that you will run into a violation of your rights along the way. If you need to report a violation, then contact the appropriate agency. For violations of the Equal Credit Opportunity Act (ECOA), contact the Consumer Financial Protection Bureau or 855-411-2372. For violations of the FHA lender process, contact HUD Complaints or (800) 669-9777.

The Fair Housing Act

The Fair Housing Act was designed to protect buyers from discrimination based on race, color, disability, religion, sex, familial status, or national origin. Violations of the law can be enforced with significant penalties for those that trespass against the rights of a protected class.

If you are the victim of housing discrimination, then you can file a complaint against the offender with HUD.

The Americans With Disabilities Act

The Americans with Disabilities Act (ADA) provides wide protections for people with disabilities. Through the act, you have the right to ‘reasonable accommodations’ to your home. With that, the reasonable accommodations of your disability will take precedence over the rules set forth by an HOA.

Additionally, you have the right to ‘reasonable accommodations’ within shared HOA facilities such as the gym or pool area. Plus, you are entitled to a service animal regardless of HOA rules.

As you navigate the home buying process, keep this in mind.

Section 504 of the Rehabilitation Act of 1973

As the first civil rights act to protect people with disabilities, Section 504 of the Rehabilitation Act of 1973 serves as a foundation.  Essentially, this act ensures that any program that receives federal financial assistance cannot discriminate against people with disabilities. Since many home loan options are available through federal programs, keep this in mind as you navigate the process of securing a home loan.

Take Advantage Of HUD Housing Counselors

A HUD housing counselor can help you navigate the home buying process. In most cases, you can find a counselor to help you at little or no cost. With their help, you can explore your budget and consider your funding options more carefully.

Find a HUD counselor today.

Research Available Grants

Beyond home loans for adults with disabilities, there are several grants available that could ease the financial burden of buying a home. Here are some of the most popular grants to start your search:

USDA Housing Grants

If you are seeking the repair loan or grants offered through the USDA, then you must already be the homeowner of the residence and unable to obtain credit from another lender. Additionally, you’ll need to have an income below 50% of the median area income. In order to qualify for the grant, and not have to pay back the funds, you’ll need to be 62 years old or older.

Additionally, the Housing Repair Loans offers applicants the funds to improve, repair, and remove health hazards from low-income homes.

Veteran Housing Grants

Veterans can qualify for several housing grants through the VA. These include:

  • Specially Adapted Housing (SAH) Grant
  • Special Home Adaption (SHA) Grant
  • Temporary Residence Adaptation (TRA) Grant

Each has specific grant limits through which you can modify a home to fit your needs.

Housing Choice Voucher (HCV) Homeownership Program

The Housing Choice Voucher homeownership program helps families that buy a home and meet the costs of homeownership. Although this program is not offered by every Public Housing Administration, it is worth looking into. You’ll need to need income and employment requirements in order to qualify for this homeownership program.

The Bottom Line

With numerous homeownership opportunities available for people with disabilities, starting down the path towards your own home is an exciting prospect. Take some time to research the different funding options available to you and understand your rights before diving in.

Apply for a Mortgage with Quicken Loans®

Apply online for expert recommendations with real interest rates and payments.

Start Your Application

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Andrew Dehan

Andrew Dehan is a professional writer who writes about real estate and homeownership. He is also a published poet, musician and nature-lover. He lives in metro Detroit with his wife, daughter and dogs.