Best Home Loans for the Disabled

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Contributor, Benzinga
September 28, 2023

Purchasing a home is a top-of-mind issue for many renters, especially as wages remain stagnant and property values continue to climb. Between high interest rates and increased inflation, many may wonder if obtaining a home loan is even possible. This is even more true for disabled borrowers, who may be on a fixed or limited income and are looking for loans that fit their unique needs.

Fortunately, helpful options regarding home loans for the disabled exist that can help make the dream of home ownership a reality for disabled borrowers. Read on to learn more about home buying and renovation options that borrowers living with a disability have to find the right space for their needs. 

Best Home Loans for the Disabled

If you’re searching for a disability loan, plenty of options could possibly provide favorable financing on a home purchase.

Special financing loans such as USDA, HomeReady, FHA and VA loans can provide mortgages for the disabled at great rates, and special programs through HUD or your state’s Housing Finance Authority (HFA) can also provide perks to disabled borrowers. The following are a few lenders and loan types that you might want to consider when comparing loan options on a limited income. 

Fannie Mae HomeReady Mortgage

Fannie Mae, a government agency that provides home financing, has a special program called HomeReady that has great terms for buyers who qualify. Because these loans are targeted toward buyers with low income and limited cash for a down payment, disabled borrowers who may be on a fixed income may be the ideal candidates for a HomeReady mortgage.

For those who qualify, HomeReady loans feature 3% down payments, a less-restrictive PMI requirement than FHA loans and no geographic dependency like USDA loans. In addition, unique perks like the freedom to receive down payments from multiple sources, immediate appraisal orders and a simple loan process make the HomeReady program a great choice for those who qualify. For more information on HomeReady Mortgages for disabled borrowers, check out Fannie Mae’s website.


If you’re considering a home purchase in a rural or suburban area, a USDA loan might be the perfect fit. The U.S. Department of Agriculture’s Single Family Housing Guaranteed Loan program (“USDA loan” for short) is only available in certain areas, but if a home qualifies, it may be eligible for 100% financing. This means that you are not required to bring a certain percentage of the home’s value down to close on your loan — a major benefit for borrowers with limited incomes. 

To qualify, a home must be located within an eligible area, and the buyer must not exceed a certain income amount. You must also agree to personally occupy the home as your primary residence, making this a great home loan option for a borrower with disabled income who doesn't want to live in an urban area. 

Benzinga’s recommended option mentioned above (New American Funding) offers USDA loans and makes the application process easy for disabled borrowers.

VA Loans

If a disabled borrower is a veteran, then a VA loan could be a great option. These loans offer you special rates, lower down payment requirements and more benefits for veterans and active-duty service members looking to buy a home. If you qualify for a VA loan and would like to learn more, the VA’s website has great information.

FHA Loans

One other loan to consider for disabled borrowers could be an FHA loan, which allows you to qualify for a mortgage loan with a down payment as low as 3.5% of your home’s purchase price. FHA loans require special qualifications, but the lower down payment can be advantageous for disabled borrowers who are living with access to limited income. 

Best Grants to Help the Disabled Buy a Home

Local housing finance authorities and the Department of Housing and Urban Development (HUD) offer programs with grants that could apply to disabled borrowers. The following programs offer grant and education options for home buyers living with a disability. 

Housing Finance Authority

All 50 states have an HFA that provides education and access to grants and mortgage credits to low-to-middle-income households. Your state’s local HFA is a perfect place to start exploring the idea of home ownership, especially when looking for disability-related assistance. Some examples of perks you might find through your state’s HFA can include things like a tax credit for mortgage payments, closing cost assistance or competitive rates. 

The National Council of State Housing Agencies (NCSHA) offers a list of local HFA links and resources here. The specific programs available and qualification criteria will vary depending on where you live and other personal factors (like your disability income). 

Housing Choice Voucher (HUD)

When most people think of HUD vouchers, apartment rentals are the first things that come to mind. While the HUD program does assist with rentals, there is also a program for Housing Choice Vouchers (HCVs) that pertains to home buyers. If you’re looking to buy a primary residence and you meet income requirements for HCVs, you can receive monthly assistance that helps cover the cost of your monthly mortgage premiums. 

To receive assistance, a buyer must typically meet income requirements. However, borrowers living with a disability and receiving government assistance related to their disability do not need to provide proof of employment in order to qualify. However, you will need to complete a home buyer’s education course and meet other qualification criteria.

Rocket Mortgage

Rocket Mortgage is one of the largest mortgage lenders in the U.S. Rocket Mortgage’s goal is to make the mortgage prequalification and application processes as simple as possible with the use of streamlined online applications. They make it easy to complete a loan application remotely, and conventional and government-backed options are available for exploration online.  

With a vast network of local professionals across the country and experience with countless loan types, Rocket is a great place to start for people with disabilities. The company specializes in issuing conventional loans and FHA loans. To learn more about Rocket Mortgage, check out Benzinga’s Rocket Mortgage review

New American Funding

New American Funding is another reliable home loan provider and a great option for disabled borrowers. No matter which type of loan you’re looking for, New American has agents who specialize in local housing markets across the country. Its extensive reach can be a major benefit for disabled borrowers looking for assistance and counseling when selecting a loan type. 

New American features something you will likely not find with any other mortgage provider: a guaranteed 14-business-day closing process. If you are looking to move quickly, New American can help by offering a streamlined process that gets you into your new home faster. Streamlined closing guarantees are available on both conventional and government-backed loan options and can be strong choices for disabled borrowers in a more urgent housing situation. 

Do Mortgage Lenders Look at Disability Income?

When applying for a loan, disabled borrowers can use their SSI or SSDI income to qualify for their mortgage. As is the case with any income in regard to a mortgage application, it will have to be documented. Any SSI or SSDI income can be verified by contacting your local Social Security office and requesting documentation for mortgage consideration. 

How Does The Government Define Disability?

The government defines disability in the United States through the Americans with Disabilities Act (ADA), which is a civil rights law that prohibits discrimination against individuals with disabilities. According to the ADA, a person with a disability is someone who has a physical or mental impairment that substantially limits one or more major life activities. Major life activities include tasks such as:

  • Walking
  • Seeing
  • Hearing
  • Speaking
  • Breathing
  • Learning
  • Working

The ADA also protects individuals who have a record of such impairments or are regarded as having such impairments, even if they do not currently have a disability. The ADA ensures that individuals with disabilities have equal access to employment, public services, transportation, and other areas of public life.

Can I Buy A House On SSDI Or SSI?

If you receive Supplemental Security Income (SSI) or Social Security Disability Insurance (SSDI), homeownership is possible. However, doing so requires careful planning due to the limited income associated with these programs. In order to afford a house, you may need to supplement your disability benefits with other resources.

There are several grants and loan programs available to individuals receiving SSI or SSDI that can help make buying a home more affordable. Grants can provide funds for down payments, closing costs, and minor repairs; while loans can be used for larger expenses such as major renovations and monthly mortgage payments.

To qualify for these grants and loan programs, you should highlight your disability status and demonstrate financial need in your application package. It is also important to submit an organized application that contains all necessary information, including proof of disability and income documentation.

Tips for a Successful Grant or Loan Application

The key to a successful grant application for those seeking assistance to buy a home is being prepared and organized. Here are tips for making sure all the necessary information is included in your application.

1. Research Which Grants and Loans You May Be Eligible for

Don’t just apply for every loan or grant available; make sure you meet the criteria before submitting an application. Some funding options are specific to certain people with disabilities, or the location of the home-to-be purchased. This research will help you narrow down your options and increase your success rate.

2. Provide Comprehensive Documentation of Your Disability and Financial Situation

The more supporting evidence you can provide, the better chance of success you have in obtaining a home loan. This includes proof of income, medical diagnosis, any applicable assessments from healthcare professionals and/or physical therapy paperwork, etc.

3. Make Sure That All Information Is Accurate and Up-to-Date

When completing the application form and any accompanying documents required by home loan program make sure all information is accurate and up-to-date. Double check everything before submitting it - one mistake can invalidate your entire submission.

4. Submit Applications Early if Possible

Some funding organizations receive many applications and funding is not always guaranteed so getting yours in early could give you an edge on other applicants vying for a similar grant opportunity.

5. Follow Up After Submitting an Application

don’t be afraid to contact the lender if there has been no response within a reasonable amount of time as this could mean they need more information or clarification on something within your submission (which may delay their decision).

By following these tips, those who are looking for grants and other loans to assist with buying a home should be well prepared when applying for funding opportunities.

How Do Parents Buy a Home for Disabled Children?

If you’re the parent of an adult child with a disability, you may wish to purchase a home for your son or daughter to live in. While you may be able to take advantage of loans with lower qualifications when buying a house for a disabled child, be aware of the following limitations.

  • Larger down payments required for non-primary residences: If you do not plan to live full-time with your adult child who has a disability and you’re using a mortgage loan to buy the home, your lender will likely consider it an investment property. This means that you’ll usually need a down payment of at least 20% to qualify.
  • Arranging for housing expenses: If you plan to use your credit and income to qualify for a mortgage loan, you should also assume you’ll also need to have sourced and seasoned assets to cover closing costs and escrow expenses. These expenses will vary depending on your lender and the type of loan you apply for.
  • Parents can’t take advantage of disability programs: If you plan to buy a home for a disabled child but retain your name on the home’s title, you cannot take advantage of programs based on the qualifications of your child. Your child must be the one applying for the loan to take advantage of local and federal programs.

Finding the Best Home Loans for the Disabled  

Finding the best home loans for the disabled can be a complex process, but with the right information and resources, it is possible to navigate through the options and secure a loan that fits your needs. It is important to explore all available assistance programs, grants, and resources specifically designed for individuals with disabilities. Remember to research and compare different lenders to find the most favorable terms and interest rates. 

Frequently Asked Questions


What is a disability loan?


Disability loans can be categorized in different ways. For example, a personal loan that you take out to purchase medical supplies following a permanent injury can be considered a disability loan. Cash-out refinance loans used to modify your home to accommodate a resident with a disability are another common example of disability loans. 


Can SSI recipients get a home loan?


Yes, SSI recipients can get a home loan. In many cases, they may also be able to obtain favorable rates, payments or grants to make homeownership more achievable. 


What are the interest rates and repayment terms for home loans for disabled individuals?


The interest rates and repayment terms for home loans for disabled individuals may vary depending on various factors such as the lender, the individual’s credit history, and the specific loan program they are eligible for.

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About Sarah Horvath

Sarah is an expert in the insurance, investing for retirement and cryptocurrency space.