As a single parent, buying a home can seem daunting. You may worry about qualifying for a mortgage or coming up with a down payment on one income. But the truth is, there are plenty of great single parent home loan options out there. You just need to know where to look.
In this detailed guide, I’ll walk you through everything you need to know as a single mom or dad navigating the home buying process. I’ll cover:
- The different types of single parent home loans
- Special mortgage programs
- Grants and assistance
- Tips for getting approved
- And much more
Whether you’re just starting your research or ready to apply for a loan, read on to learn how single parents can become homeowners.
Overview of Single Parent Home Loans
When searching for the right mortgage, you’ll find there are no loans called “single parent home loans.” But many standard mortgage programs are a great fit for single moms and dads.
These home loans offer benefits like:
- Low and no down payment options
- Lenient credit requirements
- Special assistance programs
Some of the most popular single parent home loan programs include:
FHA loans – Require just 3.5% down and have flexible credit standards. But you’ll pay mortgage insurance.
VA loans – For veterans and military members. No down payment and no mortgage insurance required.
USDA loans – 100% financing if you buy in an eligible rural area.
Conventional 97 – Put down just 3% with a conventional loan.
Down payment assistance – Grants, gifts, and loans to cover your down payment. Often for qualifying borrowers.
First-time homebuyer programs – State and local programs with discounted rates, lower down payments, and more.
The right loan for you depends on factors like your finances, credit, and goals. I’ll explain more about each program in the sections below.
FHA Loans for Single Parents
One of the most popular loan programs for single moms and dads is an FHA loan These are backed by the Federal Housing Administration and come with several perks
Low down payments – You can get approved with just 35% down On a $250,000 home, that’s only $8,750.
Lenient credit requirements – FHA loans only require a 580 FICO credit score. If your score is below average, this could be your ticket to approval.
Gift funds allowed – Have a family member gift you money for the down payment? FHA welcomes it.
No income limits – Your income can be as high as you want. FHA loans don’t have income caps.
Low mortgage insurance – You will pay this ongoing fee, but FHA mortgage insurance rates are lower than conventional loans.
Just keep in mind the upfront mortgage insurance premium and closing costs. Plan for about 3.5%-5% of the total loan amount.
Learn more about FHA loan requirements and rates in our in-depth guide.
VA Loans for Single Parents
If you or your deceased spouse served in the military, VA home loans are an amazing deal. Some perks include:
No down payment – VA loans are 100% financing. Nothing is required down.
No mortgage insurance – You won’t pay any monthly mortgage insurance, saving you hundreds per year.
Lower rates – VA mortgage rates are very competitive with average rates.
Lower fees – Closing costs are limited with VA loans. You can’t be charged most lender fees.
Relaxed guidelines – VA doesn’t set a minimum credit score. Many lenders go as low as 580.
VA loans do come with a small funding fee, ranging from 1.4% – 3.6% of the loan. But overall costs are low.
Get the full rundown in our VA loan guide.
USDA Loans for Single Moms and Dads
Don’t want to put money down and live in a rural area? USDA loans are calling your name.
USDA mortgages are 100% financing loans for low-to-moderate income buyers in rural and some suburban neighborhoods.
As a single parent, you’ll enjoy:
No down payment or closing costs – 100% financing means $0 down. Seller can pay your closing costs.
Very low mortgage insurance – At just 0.35% of the loan amount.
Flexible credit guidelines – USDA requires a 640 FICO score but may go lower.
No first-time home buyer requirement – USDA loans work for both new and repeat buyers.
Income limits apply – Check your eligibility in the USDA Income Eligibility Tool.
USDA loans are a little harder to find than other loans. But if you qualify, they can be the cheapest option around.
Dig into USDA requirements and more in our guide.
Low Down Payment Conventional Loans
Conventional loans backed by Fannie Mae and Freddie Mac come with conforming loan limits and standards. But some have down payments as low as 3%.
Conventional 97 – This common option lets you put just 3% down on a conventional loan. But you’ll pay mortgage insurance without 20% down.
HomeReady – Designed for low-income borrowers, HomeReady has 97% LTV options, discounts on mortgage insurance, and financial help for homeowners.
Home Possible – Similar to HomeReady but for middle-income buyers. Start with as little as 3% down.
Conventional loans offer competitive rates and predictable guidelines. A great choice if you prefer their standards over government loans.
Get more details in our guide on low down payment conventional loans.
Grants for Single Parents
Saving up for a down payment isn’t always feasible as a single parent. That’s where down payment assistance (DPA) can make all the difference.
DPA programs provide grants, forgivable loans, and low-cost second mortgages to cover your down payment and closing costs. Most are for first-time home buyers.
You’ll commonly find down payment help from:
State housing agencies – Check with your state for DPA options. Many have grants and second mortgage loans.
Local governments – Cities and counties offer down payment programs in their communities.
Non-profit organizations – Groups like Habitat for Humanity provide mortgage help.
Housing authorities – Agencies that manage public housing often have homebuyer assistance.
Banks and credit unions – Some lenders offer their own DPA and closing cost programs.
You can receive anywhere from $1,000 – $10,000+ in down payment help depending on the program.
Our down payment assistance guide has more ways to get free money.
Tips for Single Parents Seeking a Mortgage
As a single mom or dad, getting a home loan is very doable with the right approach. Here are tips for making it happen:
Leverage all your income – Your gross monthly income isn’t just your paychecks. It also includes child support, alimony, Social Security, retirement funds, and other sources. Let your lender know about money you receive monthly.
Get preapproved – Being preapproved shows sellers you’re a serious buyer. Get your finances in order and get preapproved before house hunting.
Boost your credit score – Aim for a credit score of at least 580 – 640. Pay down debts, dispute errors to improve your profile.
Save for a down payment – Even a small 3-5% down payment looks better than none. Save up over time.
Add a co-borrower – Having a family member co-sign your mortgage can help you qualify and afford more.
Ask about exceptions – If you almost qualify, ask your lender about exceptions or alternative documentation for special circumstances.
Shop multiple lenders – Compare mortgage rates and programs. Make lenders compete for your business.
Connect with a good real estate agent – Find an agent experienced working with single parent buyers. They can point you to the right loans, down payment help, and more.
Follow these tips and you can land approval for a single parent mortgage, even on one income.
Questions Single Parents Should Ask Lenders
Not all loan officers are created equal. As a single parent, you want one who can guide you to the optimal program and pricing.
Here are key questions to ask potential lenders:
- What loan programs do you recommend for my situation as a single parent?
- Do you offer down payment assistance programs I might qualify for?
- What grants are available to single moms/dads in this area?
- What credit score and down payment would I need for your best pricing?
- Are there any ways I could improve my chances of getting approved?
- Is there any flexibility on income requirements for single parents?
- What discounts or special rates do you offer for single parents?
- What are the income limits on your first-time homebuyer
Types of home loans for single moms
If money’s a little tighter on your single income, you might be looking for a mortgage loan that has looser eligibility requirements. Luckily, many common loan programs are flexible in this regard. Home buyers can choose from a wide range of low and even no-down-payment home loans depending on their needs.
Here are a few of the more common home loans for single moms and dads.
State-run home loan programs
In addition, all states and many cities and counties have their own home buyer programs, most of which offer down payment assistance for those with qualifying low incomes. Nearly all state-run home loans are based on one or more of those in the list above. But they may come with lower interest rates and other perks for first-time home buyers. You can see a list of state home buyer assistance programs here.
How much home can you buy with the 2% deposit home loan (for single parents)? 2021 Aussie home loan
FAQ
What is the best home loan for single mom?
Can I get money for being a single mom?
What is a single family home loan?
Single Family Housing Direct Home Loans are offered through the USDA. Also known as the Section 502 Direct Loan Program, this program offers payment assistance via a subsidy that reduces the mortgage payment amount for a short time in order to increase an applicant’s repayment ability. Create a monthly budget, and stick to it.
How do I get a home loan for a single parent?
A representative can help you find loan programs for single parents. Keep in mind that these programs often have an income cap or require you to work with certain lenders. HUD counselors: The Department of Housing and Urban Development (HUD) offers housing counselors that can help you pinpoint little-known local programs you may qualify for.
What are the best low-income loans for single parents?
The best low-income loans for single parents vary based on your situation and prospective property. An FHA, VA or USDA loan could be a great option. The best home loans for single parents with a credit score below 620 may be FHA or VA loans.
Are there first-time home buyer loans available for single moms?
Absolutely, there are first-time home buyer loans available for single moms. These often come with benefits such as lower down payments, reduced interest rates, and easier qualification criteria. Examples of these include FHA loans and certain state-specific first-time homebuyer programs.