Your ultimate guide to home loans for people with disabilities

Aspiring homeowners with disabilities can face unique challenges in their pursuit of affordable housing. But these challenges don’t have to stop them from achieving their goal of homeownership. Everyone deserves a safe and accessible place they can call their own. From grants to mortgage loans and local and national housing rights, home buyers with disabilities can leverage various resources to help overcome these challenges and purchase a home.

How does the government classify disabilities?

To qualify for disability benefits, an applicant must meet the requirements set by the Social Security Administration.

According to the Centers for Disease Control and Prevention (CDC), a disability is a physical or mental impairment that makes it difficult to perform certain tasks or function and interact with your environment. Some common types of disabilities can affect an individual’s:

• Vision
• Movement
• Thought process
• Memory
• Learning
• Communication
• Hearing
• Mental health

Can you buy a house on SSDI or SSI?

Yes, Social Security Disability Insurance (SSDI) and Supplemental Security Insurance (SSI) recipients can use their benefits to help qualify for a home loan.

If you want to maximize your house purchasing power through a benefit program, talk to a home loan specialist to learn how to develop a financial plan tailored to your circumstances and qualify for a home loan.

Government home loans, grants and programs for buyers with disabilities

There are three primary mortgage loans for home buyers with disabilities: conventional loans, Federal Housing Administration (FHA) loans and U.S. Department of Agriculture (USDA) loans. Additionally, the Department of Veterans Affairs (VA) offers several grants to assist eligible veterans, and the Department of Housing and Urban Development (HUD) offers a housing choice voucher program.

Individuals with disabilities are more likely to face economic challenges, such as lower incomes and difficulties building a strong credit history. Many may also require modifications in their homes to accommodate their needs. These programs offer options to help home buyers with disabilities secure mortgages and ensure their homes are safe and accessible.

Conventional loans

Conventional loans are conforming loans that satisfy Fannie Mae and Freddie Mac lending requirements. Some conventional loan products allow buyers to make down payments as low as 3% of a home’s purchase price, which can prove valuable for home buyers with limited budgets.

While eligibility criteria for a conventional loan can vary by lender, most conventional loans share similar requirements and guidelines.

Freddie Mac and Fannie Mae are government-sponsored enterprises that offer mortgage loan programs with low down payment options, including:

• Freddie Mac Home Possible^®: The program offers flexible credit requirements. Additionally, home buyers can add co-borrowers who won’t live in the home to the loan, providing an opportunity to receive financial help from family members with the purchase.
• Fannie Mae HomeReady^®: The program offers flexible funding options for down payments and closing costs, which can benefit home buyers with limited savings. The program also considers nontraditional income sources and provides homeownership education.

FHA loans

FHA loans, which are backed and insured by the Federal Housing Administration, have helped many home buyers with lower credit scores or past credit and debt challenges close on a home. Home buyers can purchase a home with lower down payment options than most conventional loans. Read through the table for the standard requirements of an FHA loan.

USDA loans

There are two key USDA loan products to know. The first is the Single Family Housing Direct Home Loan program, also called the Section 502 Direct Loan program. The second is the Single Family Housing Repair Loans & Grants program, also known as the Section 504 Home Repair program.

Please note that Rocket Mortgage^® doesn’t offer USDA loans at this time.

USDA Single Family Housing Direct Home Loans

USDA Single Family Housing Repair Loans & Grants

VA housing grants

If you’re a veteran with a qualifying disability, the Department of Veterans Affairs offers various programs and grants that can help you buy or modify a house to fit your specific needs. We’ve included a summary of the VA programs and grants below.

Specially Adapted Housing (SAH) Grant

Special Home Adaptation (SHA) Grant

Temporary Residence Adaptation (TRA) grant

Housing Choice Voucher (HCV) Homeownership program

Other programs for home buyers with disabilities

Aside from loans and grants, some organizations build accessible homes adapted for people with disabilities.

Habitat For Humanity

Habitat for Humanity is a global nonprofit that partners volunteers with families in need of affordable housing to build homes together. Qualified individuals or families contribute with their sweat equity or attend personal finance or homeownership courses.

Eligible Habitat home buyers require better housing. They’re likely leaving an unsafe, inaccessible, damaged, poorly constructed or unaffordable property. Read through the requirements of the Habitat for Humanity program.

Homes For Our Troops

Rebuilding Together AmeriCorps

Rebuilding Together AmeriCorps has many local chapters. Each chapter serves its community through neighborhood rejuvenation and home repair projects. Check the local chapter in your area to learn how to get involved as a volunteer or recipient.

Additional resources for individuals with disabilities

Explore our list of additional resources and services:

• Home safety and accessibility checklist: A checklist of standard home safety and accessibility features.
• Disability benefits help: A free disability evaluation to help individuals with the Social Security disability application process.
• National Disability Institute: The organization provides financial education courses to community organizations and free financial wellness tools.
• National Council on Disability: Individuals can explore the organization’s list of resources, from financial assistance to transportation to housing.

Tips for securing a mortgage loan with a disability

Securing a home you can finally call your own will take more than searching for a home or mortgage. Explore our tips to help you confidently navigate the home buying process with relevant resources and valuable support.

1. Know your credit score and improve it if needed

Your credit plays a key role in the home buying process. Check your score before searching for your dream home so you have time to improve it if needed.

For a conventional loan, you’ll need a 620 credit score. The minimum credit score for an FHA loan is 580. If you have a low credit score, you can explore home loan options for home buyers with bad credit.

Strategies to improve or fix your credit score can include, paying off debt, paying your bills on time and disputing errors on your credit report. You can also hire a credit repair professional to help you fix your credit.

2. Set a budget and know what you’re looking for

Use a mortgage calculator to estimate how much home you can afford with your current expenses. Use these numbers to create a budget, keeping in mind that you may need to set aside funds to remodel and make your home more accessible.

The type of home you choose may impact the cost and types of renovations you can make. It’s important to know what you want and need before starting your home search.

3. Complete all home buying steps

Keep these extra tips in mind throughout the home buying process:

• Ask the right questions: Before meeting with a mortgage lender or REALTOR^®, prepare a list of questions to ask them. Ask questions about mortgage loans, including available loan options, monthly payment amounts, credit score qualifications and income requirements.
• Get preapproved: Mortgage preapproval, also called initial mortgage approval, can help establish a realistic housing budget and speed up the home purchase.
• Pay for a home inspection: Don’t skip the home inspection. The upfront cost to potentially uncover significant and costly conditions in a home may save you thousands in the long run. If the home requires extensive repairs, you may be able to negotiate a lower price.
• Research additional programs: If you’re an older adult, veteran, first-time home buyer or a lower-income borrower, look at additional programs beyond those that exclusively serve home buyers with disabilities.

4. Understand your housing rights

There are laws and policies in place to ensure equal housing opportunities – and you must know your rights to know when they’re violated. We’ve gathered a list of critical legislation and advocacy services you should know:

• Americans with Disabilities Act (ADA): A sweeping civil rights law that protects people with disabilities.
• Fair Housing Act: The law prohibits housing discrimination based on disability or other protected characteristics.
• Section 504, Rehabilitation Act of 1973: The law ensures people with disabilities have equal access to programs or activities that receive federal financial assistance.
• National Disability Rights Network: A nonprofit membership organization, NDRN provides advocacy services for people with disabilities.

Mortgage discrimination

The Fair Housing Act and the Equal Credit Opportunity Act (ECOA) protect people with disabilities and other protected classes from mortgage discrimination. The Federal Trade Commission (FTC) has resources on mortgage discrimination, including information on income requirements, co-signers, application outcomes and questions mortgage lenders can’t ask.

Reasonable accommodations: HOA and neighborhood

Under the ADA, you have the right to make reasonable accommodations to your residence. The Act should take precedence over a homeowners association’s (HOA’s) aesthetic guidelines or policies. You also have the right to reasonable accommodations in communal HOA facilities, like pools and gyms. Your HOA can’t interfere with your right to own a service animal. ADA statutes also apply to the public sidewalks and streets outside your residence.

If you’ve experienced housing discrimination, you can reach out to your state agency or the Office of Fair Housing and Equal Opportunity (FHEO):

• Fair Housing Assistance Program (FHAP) by state
• Fair Housing and Equal Opportunity (FHEO)
• HUD – Report Housing Discrimination

Consider HUD housing counselors

The bottom line

Everyone deserves to live in a safe and accessible home. The more informed you are about the home buying and mortgage process, your rights, and the assistance local nonprofits and federal programs provide, the better you can navigate your home purchase.

If you’re ready to explore your home loan options, start an application online with Rocket Mortgage. We can advise you on the best options for your home buying journey.