Jonah JacobsWhen it comes to affordable housing, many low-income families tend to focus on renting via the Section 8 program. If you succeed in getting a Section 8 voucher, it limits your rent to just 30 percent of your income, with the government picking up the rest of the tab.
While that can reduce your housing costs, why not buy a home instead? Contrary to popular belief, you don’t need excellent credit or a ton of income to do so, as several programs convert low-income renters into homeowners. And while Habitat for Humanity may be a popular option, you are about to see that many others exist.
The Benefits Of Habitat For Humanity
Before we jump into Habitat for Humanity alternatives for low-income families, let’s take a quick look at how this program works. It’s a myth that Habitat for Humanity offers free homes to those in need, as you will have to put in sweat equity to either help build the home or volunteer in the community, plus pay a mortgage.
Before you let that turn you off, know that a Habitat home is very beneficial since it can offer safe, sanitary, and affordable housing so your family can gain stability. And if the thought of paying a mortgage on your Habitat home causes dread, know that you can get a loan through this program that has zero interest, closing costs, or a down payment. In other words, that mortgage can turn out to be cheaper than what you are paying your landlord, plus you get the benefit of owning a home that can increase in value to elevate you financially.
Habitat For Humanity Alternatives For Low-Income Families
Here are some programs that have helped low-income families buy homes in the past, despite less than stellar credit history or a ton of cash for a down payment:
Freddie Mac Home Possible
Has a home’s down payment kept you from looking into purchasing property? Then you may want to give the Home Possible program a look, as it can get you into a home with just a three percent down payment if you live in an underserved community and have a low to moderate income.
City And State Homebuying Programs
Several cities and states have homebuying programs for low-income families. Find yours here, where you could enjoy benefits like down payment assistance, the ability to get a loan with bad credit and little money down, and more.
HomeReady From Fannie Mae
With 97 percent financing from Fannie Mae’s HomeReady program, you won’t have to worry about saving years for a substantial down payment.
FHA Loans
You can make little income and have an unstable credit history, but if you can show work stability and some ability to pay an affordable mortgage, you could qualify for an FHA loan that can finance up to 96.5 percent of a home’s purchase price.
