Can you Buy a Home while Receiving Social Security Disability Benefits?

Submitted by Shane on

Many people who receive Social Security Disability benefits wonder if it is possible to own their own home, or if they will be stuck renting for the rest of their lives. There are many preconceived notions about people who receive Social Security Disability being unable to qualify for a mortgage. They fear that they do not have enough income or that the fact that they are on disability and not employed will get in the way of qualifying for a mortgage loan. This isn't necessarily the case. Many people who receive Social Security Disability benefits can qualify to buy a home and there are programs in place to help disabled individuals qualify for a mortgage. If you are receiving Social Security Disability benefits and you want to purchase a home of your own, there are some things you need to know.

Your Credit Score and Income

No matter what type of mortgage you are applying for, lenders will look at your credit score and income when determining whether or not to approve you for a loan. That does not mean, however, that you will not be able to purchase a home if your credit score is less than perfect or if your income is limited to your Social Security Disability benefits. There are programs in place for disabled individuals to help overcome the obstacles of imperfect credit and limited resources.

Programs to Help You Buy a Home

If you are receiving Social Security Disability benefits, there are programs that can help you purchase the home you need. The Fannie Mae Community HomeChoice program provides assistance to disabled individuals who want to purchase a home but have limited income. Even if your credit rating has suffered, you may qualify for a home loan under this program when receiving Social Security Disability, depending on your Monthly Benefit Amount (MBA). Fannie Mae can also provide you with a loan that will allow you to make improvements to the home you buy if those improvements are directly related to your disabling condition.

Another program that you may want to look into is Section 8. Many people assume that Section 8 assistance is only for renters, when in reality the program can also help you purchase a home. If you qualify for Section 8 and your local Section 8 office participates in the home ownership program, you can receive assistance in making your monthly mortgage payments, making home ownership more affordable.

Habitat For Humanity is another program that can help people who receive Social Security Disability enjoy the benefits of home ownership. The program is geared towards low-income families and provides low-interest mortgages ranging from seven to thirty years. In many cases you need to put “sweat equity” into the purchase of your home, but if you are unable to help with the construction of your home due to a disability you may be able to work out alternative arrangements. Habitat for Humanity programs are organized at the community level, and so eligibility rules may differ between local organizations.

Down Payment Issues

If you receive Social Security Disability and you are able to qualify for a mortgage program, you may be worried about coming up with the down payment for the purchase of your home. Fortunately, there are creative financing options available to help you meet your down payment requirements.

The Fannie Mae program discussed earlier may require a down payment of as little as $500 when you are receiving Social Security Disability. For other programs you may want to consider “sweat equity” options or you may want to offer full price for the home if the seller is willing to “gift” the down payment.

When receiving Social Security Disability, you can also look into grants or gifts for your down payment needs. Some programs, such as the IDA program, allows you to save money towards your down payment and will match part or all of the money you put into the IDA account to be used for the purchase of a home. So if, for example, you have saved $1,000 from your Social Security Disability benefits towards your down payment, the matching gift would be $1,000, giving you a total of $2,000 to put down on your home purchase.

Making Ownership a Reality

If you are receiving Social Security Disability and you want to purchase a home, there are resources out there to help you do it. Many organizations want to help those who are on Social Security Disability realize the dream of home ownership. Look into the programs mentioned above and see which ones you qualify for. If you use one of the programs to purchase a home, you can start putting part of your Social Security Disability benefits towards owning your home instead of putting rent in your landlord's pocket.

Additional Resources 

Blog comments

Elma lannager (not verified)

In reply to by Bryan

Ty. The only site that was

Ty. The only site that was available was yours. The second one said page not found. The first would not load but that one I will call SSA and go from there.

Mon, 06/20/2016 - 17:55 Permalink
Terri (not verified)

Can you please define the

Can you please define the difference between SSI and SSDI.
Can a person on SSDI rent their home out and relocate to a new home?

Sat, 06/25/2016 - 16:24 Permalink
Tayloir (not verified)

Would buying a house cause me

Would buying a house cause me to loose my bennifits ?? I am on SSDI

Thu, 06/30/2016 - 08:51 Permalink

In reply to by Tayloir (not verified)

Hi Tayloir,

Hi Tayloir,
If you are on SSDI, your benefits are based off of your work record rather than your income or resources, so you would not lose benefits because you bought a house.

Thu, 06/30/2016 - 10:58 Permalink
Derek (not verified)

I am on disability and

I am on disability and receive SSDI Payments. I went through USDA for a loan and was approved. The only problem getting a loan to buy a home and receiving disability pay is you might not get what you expect. All of the homes I looked at that I could afford needed so much work done to them to be livable in really weren't worth getting. I mean, if all my SSDI money for the month is going to making a payment and electric bills etc. etc. it leaves very little left to try and fix up your new home. No-one is going to lend you big money if they don't think you have enough to pay it back. Unless you have inheritance gifted to you or access to other funds don't look forward to a nice brand new non fixer upper house.

Fri, 07/01/2016 - 11:32 Permalink

In reply to by Derek (not verified)

Hi Derek,

Hi Derek,
Thank you for sharing your experience!
It's true, many homes in the price range of someone on disability payments are not going to be the newest homes, but programs like Habitat for Humanity may be able to help with the repairs.

Fri, 07/01/2016 - 13:10 Permalink
Brenda (not verified)

I'm on disability &

I'm on disability & own my home (only through having my sister cosign w/ me) & had a down payment. As all on disability know, we haven't had a cost-of-living raise in 3 years, but taxes still increase every year & house ins. still increases every year. So my house pymt go up every year. My last child graduated from high school so that income is gone, as well as child support. Now my mortgage pymts are almost impossible to make. Are there programs out there for me to be able to refinance at a lower interest rate thru SSDI? Thx for any help you can provide!

Tue, 07/05/2016 - 11:10 Permalink
Brenda (not verified)

In reply to by Bryan

Shot down. Must have closed

Shot down. Must have closed on the house on or before May 2009. I just have to get used to being on the ground...

Tue, 07/05/2016 - 18:31 Permalink
Tonia (not verified)

I so need your help. My

I so need your help. My credit score is in 800, I have one credit care with limit of $16.000 I have been trying to buy a home. My moblie home of 12 years is flling down but can make a good down payment off of it. I have it sold but need help because no one will give me a load by my self with $730.00 income. I own where I live can sell it, I have some saving I am LOST HELP PLEASE I am in Ohio

Tue, 07/05/2016 - 20:50 Permalink
Beth (not verified)

My sister-in-law just

My sister-in-law just received $20,000 from the sale of property owned by her deceased mother he passed away four years ago . She is preapproved for $45,000 loan and wants to purchase a home which is fine but my question is will receiving the $20,000 down against her SSI or. SSDI. The money from the sale of the property was not part of the inheritance as it was just sitting In their names. According to the real estate lady it would be considered income.

Wed, 07/06/2016 - 17:16 Permalink

In reply to by Beth (not verified)

Hi Beth,

Hi Beth,
if your sister-in-law is on SSDI, then there is no problem because there is no limit on the amount of unearned income you can have while on SSDI. If she also gets SSI, she may lose her SSI benefits for the month that she received the money, and it would be considered a financial resource for any subsequent months.

Thu, 07/07/2016 - 09:41 Permalink
GMBD (not verified)



Thu, 07/07/2016 - 13:08 Permalink

In reply to by GMBD (not verified)

Hi There,

Hi There,
If your grandson is claiming SSDI benefits, then buying a house may not play into his appeal as SSDI benefits are based off of work record rather than income and resources.

Fri, 07/08/2016 - 09:51 Permalink
Tracy (not verified)

Hi i am on ssd and only

Hi i am on ssd and only receive 970.00 a month can i find a program to buy a house i cant keep moving from place to place i would love to own my own house please help

Mon, 07/18/2016 - 12:12 Permalink
Sandy (not verified)

My husband is on SSD. I&#039

My husband is on SSD. I'm currently employed. Who do I call to see if we can receive some help either buying a home or with the down put. Thank you..

Mon, 07/25/2016 - 15:20 Permalink
Awilda Nater (not verified)

I received 3 monthly check

I received 3 monthly check from $733 each one from SSI disability..My score is 658..I am a sick woman my husband take care of me and that the only income i received..Do you thing i got the chance to qualified for a first buy home.

Tue, 08/02/2016 - 19:07 Permalink

In reply to by Awilda Nater (not verified)

Hi Awilda,

Hi Awilda,
I would not be able to say what your chances are regarding purchasing a home as I do not have any expertise in home financing, however you may be able to get a better picture of your prospects if you contact someone in the finance industry.

Wed, 08/03/2016 - 14:02 Permalink
J W (not verified)

I'm on disability &

I'm on disability & can only have $2000 in the bank. do you think Social Security or Hud can help me purchase a house?

Wed, 08/03/2016 - 04:56 Permalink
Tiffani (not verified)

Can I be a cosigner n a house

Can I be a cosigner n a house?

Fri, 08/05/2016 - 17:26 Permalink

In reply to by Tiffani (not verified)

Hi Tiffani,

Hi Tiffani,
You may be able to be a cosigner on a house depending on the requirements of the mortgage company.

Mon, 08/08/2016 - 10:00 Permalink
Diana (not verified)

It really didn't help I

It really didn't help I just want to buy a home so my child will have something that we never have to move again

Tue, 08/09/2016 - 05:31 Permalink
Connie smith (not verified)

Thanks for the contacts and

Thanks for the contacts and advice .I so want to own my own home again,I am disabled and only have as my income however I will do what I have to do to get into my own home .I love big houses I would like a 4 bedroom and two baths ,I love to decorate and I can't stand little houses I am closdafobic pretty sure that's not right spelling .I went through a horrible divorce ,he was always on drugs in stood it for 8 yrs but when he tried to kill me with weed killer that was the end .He took my home I worked my tail off to make so pretty ,I got some furniture and a few household stuff but his gf and him kept most of it I saw one that was in union city that had a separate living space like a mother in law suite that way if I could get the house maybe I could rent it out and make the bills ,like electric water ,cable ,house payment ,car payment stuff that I have to pay monthly .I sure hope someone can help me out here .Thanks again

Wed, 08/10/2016 - 15:42 Permalink
Robert (not verified)

Hello. I receive ssdi and was

Hello. I receive ssdi and was wondering if there were any programs that could help me buy my own home. I am married with a 9 year old autistic step son and am about to be a new dad in about 6 months. My credit is in pretty bad shape due to my disability. I opened a bunch of credit cards and then almost died of carbon monoxide poisoning. I was in ICU for 17 days and in the hospital for about 30 days. We currently are living in her mom's basement but it is already tight living. I want to own my own home. Can you help steer me in the right direction. Thank you so much.

Fri, 08/12/2016 - 09:53 Permalink
Garrett (not verified)

I'm a single father who

I'm a single father who only has visitation but I have no legal rights so on paper I have no children. This leaves me with no help and I only get around 800 dollars. Also now I lost my last place because the owner decided to sell, now I'm forced to move in with my dad. I'm 34 and with the food prices and not being able to get food assistance, gas, and trying with whatever I can scrape up to do something with my two girls of 10 and 14. It's impossible.. I really just feel like giving up some days. But then I remember it's not about money and nice things and I look at the love in my life though my family and push forward. I live in a small town and there are limited housing for ssi recipients and the waiting list can take years and if your not ready when your number comes up you drop off or to the back of the list. Buying a home seems like a dream and if there is a way for someone like me who has chosen feeding myself and my children instead of paying off bills when times got hard.. then please, sign me up!

Mon, 08/15/2016 - 19:35 Permalink
Gina (not verified)

Thank you for this

Thank you for this information! I too am on SSI but have already been half owner of my property for 16 years. The other owner had a mortgage that he defaulted on so now I have to find a way to buy the other 50% after foreclosure. Felt completely hopeless until now - thank you so much!

Wed, 08/17/2016 - 22:23 Permalink
Anonymous (not verified)

I need help to buy a I am on

I need help to buy a I am on Ssi please call me.

Thu, 08/18/2016 - 18:37 Permalink
Deb (not verified)

I have a 31 y/o disabled son

I have a 31 y/o disabled son who now collects SSDI on my SSDI account. My goal is to buy a condo for him now instead of paying rent. As I am aging and not in good health, it is rather urgent for me to accomplish this. I will not rest in peace not knowing if my son has a place to live. There is so much out there that I am now so confused as to what would be the best benefit program to accomplish this. There is FHA, Fannie Mae, community programs but I need help determining which one will work best for our circumstances. We are looking to buy in Chicago. I read about grants, reduced interest rates and extended term limits as well as monthly payment assistance. I just can't seem to find anyone who can help me put this together. Any suggestions will be greatly appreciated.

Thu, 08/25/2016 - 13:14 Permalink
Anonymous (not verified)

I received a large lump-sum

I received a large lump-sum of money from my ex-husband's pension. Im on SSI/SSDI. The money i just got is hopefully going to get me and my daughter into a home of our own. Is it going to count as income and reduce, or eliminate my benefits even though im using it to purchase a home?

Mon, 08/29/2016 - 09:32 Permalink

In reply to by Anonymous (not verified)

Hi there,

Hi there,
If you are on SSDI, then it may not affect your benefits. If you are on SSI benefits, then the lump sum would be counted as income for the month you receive it and a resource for the months after.

Mon, 08/29/2016 - 09:36 Permalink
sharon (not verified)

i am on ss and my son

i am on ss and my son receives ss from his father i also am on the sec 8 voucher program. however due to a back injury i cannot work, and the only way to use their housing program is to work 30 hours a week to be able for them to help. How can i purchase a home if i cannot work the 30 hours and the voucher program help me to achieve a home?

Wed, 08/31/2016 - 22:06 Permalink
Melissa Radford (not verified)

Hi I'm disabled I'm

Hi I'm disabled I'm am trying to buy a home can someone help me

Mon, 09/05/2016 - 12:54 Permalink
Toby (not verified)

My roommate and I have been

My roommate and I have been renting a home while both on SSI. Share the load kind of thing. The owner is now selling the home. Rent is higher for homes now then when we rented and will make things harder with higher rent. Owning a home will cut the rent payment in half so to make things cheaper and of course more affordable. My father offered to loan me the down payment, can I buy the home while on SSI with my fathers assistance or is that considered income? Thank You.

Wed, 09/07/2016 - 13:06 Permalink

Add new comment

Find Out If I Qualify for Benefits!