Whether you are a single mom or dad, going it alone with kids can put a serious strain on your finances. But living on less income than when you were married doesn't mean you can't buy a home, or that you have to struggle with making the payments on your current home. It does mean you have to search out mortgage loan programs that offer home buying and home loan assistance.
The U.S. Federal Housing Administration (FHA) backs mortgage loans offered by FHA-approved lenders. The program helps families with lower incomes borrow money to buy a home. Even if you've had credit problems in the past, you still may qualify for an FHA-insured loan. The loan limit for which you may qualify depends on the state and county where the property you want to buy is located.
If you don't have much in extra cash or savings and can't afford the down payment or closing costs a conventional mortgage loan requires, FHA loans offer low closing costs and down payments for as little as 3.5 percent of a home's purchase price. Qualifying for an FHA loan also is easier. A lender may accept a lower minimum credit score and a higher debt-to-income ratio -- the amount of your monthly income you use for paying bills. In addition, you can qualify for a loan sooner after bankruptcy or foreclosure.
The U.S. Department of Housing and Urban Development (HUD) offers free housing counseling if you can't afford to pay the fees. If you are at risk of losing your current home, seeking housing counseling services can help you avoid foreclosure. A housing counselor will assist you with qualifying for loan modification or refinance to reduce your monthly loan payments.
If you don't currently own a home, HUD offers single-family residential properties for sale across the nation. HUD homes are properties with FHA-insured mortgages that lenders foreclosed on. Although HUD does not provide direct financing to homebuyers, you may qualify for an FHA loan. Since foreclosure homes often are in poor condition, you can apply for an FHA 203 (k) Rehabilitation Loan at low financing. The loan helps you afford to make repairs and improvements to the home.
Habitat for Humanity
A nonprofit housing organization, Habitat for Humanity builds, repairs, and renovates homes to sell to families who need affordable housing. The organization uses volunteer labor and donated materials. Habitat makes no profit on the sales, as the homes, which are financed with zero-interest loans, are intended for limited-income households.
To qualify as a homeowner family, you must be willing to become a partner in the program, be financially able to repay the mortgage loan, and meet a certain level of need. Although local affiliates set their own guidelines for qualifying, you must be able to make an affordable down payment and the monthly mortgage payments on time.
As part of the application process, you must show that you have good credit and a steady income. Along with attending homeowner education classes, you are required to contribute a specified number of sweat-equity hours in building or renovating your home, as well as homes for other families.
When I got my first credit card, I had no idea how to manage my money. I made a lot of mistakes that I later regretted and had to spend many years rebuilding my credit. I didn't realize that even one mistake can cause serious damage to your credit score. I did a lot of research into money management and credit repair options and put the effort in to rebuild my credit. This site is a compilation of the things that I've learned and the steps that worked for me. Hopefully the information here can help you to avoid some of the struggles that I faced.