Free housing grants that are strictly tailored to suit the needs of single mothers do not generally exist on a national level. Housing assistance programs offered by the U.S. government usually fall in the realm of assistance for first time home buyers, low income buyers and rural area home buyers. Single moms falling into any of these categories may be able to get some help when buying a home.
Find Subsidized Loans and Housing Assistance for Single Mothers
Most of the programs available for single mothers are not outright grants, but instead are special loans or subsidies. Many types of assistance are low-interest loans, usually with very special stipulations, such as they may be forgiven if you live in the home a certain amount of years, or they may not need to be repaid for many years. Even still, the help is valuable and real.
USDA Single Family Housing
The United States Department of Agriculture provides direct loans for low and very low income households in rural areas. The interest rate is based on the borrower's income. These subsidized loans are available to:
- People who don't have adequate housing already.
- People who are unable to get credit elsewhere.
- People who are able to make the mortgage payments.
- People who have a reasonably good credit history.
Read more about how to qualify at the USDA Income and Property Eligibility Site.
USDA Programs
Here are descriptions of a few of the other USDA programs available:
Rural Housing Direct Loans
Funded directly by the government, these are 100% financing loans. The loan may include the dwelling, site, construction or to purchase newly constructed dwellings in a rural area. The home in question must be located in an approved rural area. Funds may also be used to repair, renovate or even relocate a home, and to provide water and sewage facilities.
Terms are up to 33 years, or 38 for those with extremely low incomes. A payment assistance subsidy is available for those who cannot afford the regular payments. The applicant(s) must have low or very low income; low is 50 to 80 percent of area median income (AMI) while very low is below 50 percent of AMI. The applicant must also be unable to obtain credit elsewhere but "have reasonable credit histories." This is not an outright grant, although the payment subsidies available do not have to be repaid and are therefore a type of grant. You can visit the USDA income and property eligibility site to verify whether your income qualifies for the program.
Guaranteed Loan Program and Home Repair Loan
The USDA guaranteed housing loan would be an appropriate choice if you are a single mother in lack of adequate housing, but capable of affording mortgage payments and the accompanying tax and insurance costs. The USDA also requires you to have a stable income in addition to having reliable credit score ratings. You will be required to fill out Form RD 1910-5 (Request for Verification of Employment) when applying for this particular type of housing assistance with a USDA-approved lender.
The repair loan and grant program offers grants or loans for very low-income persons to repair and modernize their dwellings. Whereas repair grants are only accessible to organizations, you can individually access repair loans from approved lenders in your state. Your dwelling must comply with USDA qualifying criteria.
Mutual Self-Help Program
This program allows the homeowner to build up "sweat equity" by assisting in the building of other people's homes and their own, in exchange for paying less for his or her home. Groups of participants build each other's homes and nobody moves in until the final house is complete. The Mutual Self-Help Housing Program may allow you to save as much as 50 percent or more over normal new home prices. The USDA also offers mutual self-help technical assistance grants through a program that allows future homeowners to work on the homes themselves.
HUD Programs
HUD offers a variety of programs to assist elderly, disabled and low income individuals to obtain home ownership, or rent subsidies for decent housing.
The Housing Choice Vouchers program
Administered by the U.S. Department of Housing and Urban Development (HUD), the aim of this program is to assist very low-income families, the elderly, and the disabled with paying for decent, safe, and sanitary housing in the private market. The individual locates the home and the government offers vouchers to the landlord for payment. Learn more about this program.
Homeownership Voucher Program
This program is designed for very low income individuals and others, including single mothers. Once you are enrolled in the Housing Choice Vouchers rental program, you may apply in the homeownership program. With the program, renters may substitute the rental vouchers they were receiving to vouchers for homeownership. Under this program, low and very low income buyers also have the opportunity to buy public housing units and developments, effectively becoming the landlords.
HUD Public Housing Program
Low-income single mothers seeking safe and decent rental housing can try out the HUD Public Housing program. This particular program provides rental houses of varying sizes and types that are suitable all types of family needs such as single family houses and housing for elderly families.
The Income Factor
Notably, subsidized loans and housing assistance for single mothers are not absolutely restricted to low-income earners. There are various housing assistance programs that are designed for first home buyers who are not necessarily classified as very low-income earners. These programs particularly come in handy when you are a first time home buyer lacking a credit history or having insufficient down payment for your target residential property mortgage. The USDA guaranteed housing loan is one such example. Other programs include the Housing Finance Agencies (HFA) Risk Sharing and Adjustable Rate Mortgage Insurance.
Housing Finance Agencies (HFA) Risk Sharing
The Housing Finance Agencies (HFA) Risk Sharing is a HUD-backed lending program through which single mothers, regardless of their income classification, can access financing for multifamily housing units that are subject to loans that are underwritten and processed by the HFA. This program, nonetheless, imposes certain qualification criteria for its assistance. For instance, you must already have purchased or be planning to purchase a multiunit building for rental purposes and demonstrate the need for assistance on issues concerning the ownership of the property or land.
Adjustable Rate Mortgage Insurance
The Adjustable Rate Mortgage Insurance program is managed by the HUD and is designed to assist individuals to purchase single family home for their primary residence. However, you cannot access direct lending through this program. You only get to access subsidized loans from FHA-insurance approved lenders.
Additional Assistance for Single Mothers
There are many options to help single mothers find affordable housing. You may also look into any assistance that may be available from your state. Community Block Development Grants are awarded annually to the state and local bodies. These funds are slated for the provision of safe, affordable housing for residents and they must be awarded by the state or local body to applicants. Applicants include single mothers, individuals, home owners and developers. Contact your state and local governments to find out more about these grants.
