Though real estate prices over the past two years have climbed more than 30% — according to the Case-Shiller U.S. National Home Price index — experts predict a recession is imminent, which is expected to drive down home prices.
If you’re a single mom who has been looking for a way to purchase your first home, there are a lot of first-time home buyer grants and assistance programs available to help. These programs include:
- Bank of America grants
- Chenoa Fund down payment assistance
- Community Development Block Grants
- HUD’s Housing Choice Voucher Program
- State Housing Finance Agencies
These programs offer assistance from down payments and closing costs to affordable financing and loan forgiveness options. All will require a recent work history.
Keep reading for our full list of first-time home buyer grants for single moms:
Bank of America’s Community Homeownership Commitment program provides grants toward down payments and closing costs for first-time home buyers. Grants include:
- Down payment assistance up to $10,000 or 3% of the purchase price, whichever is less
- Up to $7,500 in closing costs
You can also apply for the Bank of America Affordable Loan Solution mortgage, which offers home loans up to $647,200 with a 3% down payment and up to $970,800 with a 5% down payment.
Applicants have to meet certain income requirements (varies by area) and may have to complete a home buyer education program for first-time home buyers from an HUD-approved counseling agency. Mortgage insurance is required.
If you have an FHA loan, the Chenoa Fund offers down payment help for first-time or repeat home buyers in the form of a second loan. The loan options include:
- Repayable loan with a 10-year term. It will have a 2% higher interest rate than your FHA home loan and requires a monthly payment.
- Forgivable loan with a 30-year term and a 0% interest rate. It does not require monthly payments, provided you stay current with payments on your FHA loan.
The forgivable 30-year loan is backed by the government. It offers:
- A 3.5% down payment loan that’s forgivable after 36 consecutive, timely payments on your FHA mortgage
- A 5% down payment loan that doesn't have to be paid back if you make 120 consecutive, timely payments on your FHA mortgage
At the end of the 30-year term — if either of the previous forgiveness conditions have not been met — the loan will be forgiven even with late payments on the FHA loan. However, if the individual sells or refinances the home, the loan will need to be repaid at that time.
To qualify, you need a credit score of 600 or higher. There are no qualifying income limits. Anyone can apply. However, lower-income applicants can get better rates.
This program is available in every state except New York.
Community Development Block Grants (CDBGs) provide funding to improve the quality of housing in low-income neighborhoods. HUD sends CDBG funds annually to grantees, including city and county governments.
The Volusia County, Florida government, for example, uses the funds to help first-time home buyers purchase a home. They provide funds for down payments and closing costs, and offer affordable financing terms. That includes a 15-year, 0% interest deferred payment loan that goes toward the cost of the home and closing costs.
Eligibility for programs funded by CDBG grants vary, but for the Volusia County loan specifically, you must be able to afford payments on the mortgage and be a first-time recipient of Volusia County housing assistance, among other requirements.
Your local HUD field office can help you find CDBG grantees in your area that may offer similar initiatives. You can also ask about specific eligibility requirements.
If you live in public housing and want to buy a home, HUD public housing agencies (PHAs) are helpful resources.
You can get help if:
- You live in or are eligible for public housing
- You meet income requirements (varies by area)
- You can pay at least 1% of the purchase price as a down payment
PHAs can help you learn about the home-buying process, offer financial assistance for down payments and closing costs, and offer lease-to-buy options for homeownership.
For example, the Philadelphia Housing Authority offers two programs: Housing Choice Homeownership and Section 5 (H) Homeownership. Some requirements of both these programs include:
To be eligible for Housing Choice Homeownership in Philadelphia, you must:
- Be a first-time home buyer
- Own or obtain shares in a cooperative living space
- Complete an approved housing counseling program
- Make a minimum of $14,500/year ($6,624/year for disabled applicants)
- Have at least one year of employment experience and work at least 30 hours per week (unless disabled)
- Have no criminal convictions within the last five years
- Have never defrauded the federal government
- Choose a home that is able to pass approved inspections
To meet eligibility requirements for Section 5 (H) Homeownership in Philadelphia, you must be:
- A current PHA single-family scattered site resident (scattered sites are homes that are found throughout urban areas instead of one large building in a specific neighborhood)
- The head of household or at least 18 years old living in a PHA scattered site for at least one year
- Current on rental payments, utilities, and any other required bills
- In good standing with the lease requirements for twelve consecutive months
- Earning at least $11,301 annually from a stable job and able to obtain and afford a mortgage
- Willing to participate in pre- and post-purchase housing counseling
Each PHA will have its own programs and requirements. To learn more, contact your local PHA.
Homeowner Assistance Fund
The National Council of State Housing Agencies (NCSHA) Homeowner Assistance Fund (HAF) is a federally funded program designed to help homeowners who are struggling to pay mortgages due to the impact of COVID-19.
Part of the American Rescue Plan Act, this program distributes funds to grantees in all states, the District of Columbia, Guam, American Samoa, the U.S. Virgin Islands, the Commonwealth of the Northern Mariana Islands and tribal lands.
In Washington state, for example, HAF is administered by the Washington State Housing Finance Commission in partnership with HomeSight, a nonprofit that helps low-income citizens pursue affordable homeownership.
To qualify for Washington’s assistance fund, you must have:
- Experienced a financial hardship before or after January 21, 2020 that continued after that date
- Income equal to or less than 150% of the area median income or 100% of the United States median income (whichever is greater). The U.S. median income was $67,521 in 2020, according to the U.S. Census Bureau.
- Income documentation such as 1099s, W2s, or tax filings
This program does not take into account other data such as a credit score, foreclosure status, or previous refinancing.
If you need help paying your mortgage, use the HAF by state map to find out what your local program offers and to find contact information.
The HUD Housing Choice Voucher (HCV) program (also known as Section 8 housing) primarily helps low-income individuals and families find and afford safe, clean housing. That includes single-family homes, townhouses, and apartments. These vouchers are administered by local public housing agencies (PHAs), and each one sets its own eligibility requirements.
In North Texas, for example, you are eligible if:
- You are a first-time home buyer who is also a single parent
- You previously owned a home while married or lived in a home owned by your ex spouse within the last three years
- You are a first-time home buyer who has a disabled family member and owned a unit within the last three years
Requirements vary by state, and all PHAs do not participate in the HCV homeownership program.
The HUD Good Neighbor Next Door Sales Program offers homes for sale at 50% of their value to eligible teachers, first responders, and police officers.
An eligible applicant is one who is a full-time:
- Law enforcement officer employed by a federal, state, local government, or Indian tribal government-run agency
- Teacher in a pre-kindergarten through 12, state-accredited public or private school
- Firefighter or emergency medical technician (EMT) employed by a fire department or emergency medical services response unit run by the federal, state, local, or Native American tribal government
Eligible home buyers must work and live in qualifying revitalization areas listed by the program. Program participants must agree to reside in the home as a primary residence for at least 36 months.
National Homebuyers Fund, Inc. (NHF) is a nonprofit corporation helping single moms become homeowners. The nonprofit offers funds up to 5% of the cost of the home’s mortgage to be used toward a down payment, closing costs, or both depending on the home buyer’s needs.
To apply for NHF, you must work with a participating lender. Available in most states, this program has flexible qualification criteria:
- You don't have to be a first-time home buyer
- You can have low- to moderate-income (income limits are determined by state)
- You need a minimum credit score of 640
- Your debt-to-income ratio cannot exceed 45%
- The home assistance must be used for conventional, FHA, USDA, or VA loans
Depending on the program in your state, the assistance may be forgivable or require repayment over time. Plus, you can couple this financial help with other home buyer assistance programs for maximum benefit.
In each state, the Housing Finance Agency (HFA) can help single moms buy a new home. Federal programs in every state include:
- Housing Bonds — Sells bonds to help low-income, first-time home buyers get affordable loans
- Housing Credit — Offers a tax credit to private entities and developers who create more affordable rental housing
- HOME Investment Partnerships — Advocacy program that improves access to safe, clean, affordable housing for low-income households
But each state also offers HFA-based homeownership programs with various requirements.
The California HFA (CalHFA), for example, offers a down payment/closing costs assistance program called the MyHome Assistance Program. CalHFA is not a direct lender but trains and approves private loan officers. The program provides a deferred payment second loan if you have an FHA or a conventional loan.
With an FHA loan, you can get a second loan that is up to 3.5% of the purchase price or appraised value (whichever is less) to help with the down payment or closing costs. With a conventional loan, you can get assistance up to 3% of the purchase price.
Contact your state HFA to get exact details on the programs offered in your area and to learn about eligibility requirements.
Bottom line: Why single moms want a home buying grant, if available
Owning a home is a great way to build wealth over time and provide a valuable asset to potentially pass on to your children. But when you’re a parent with one income, owning a home might seem out of reach. A first-time home-buying grant can help you obtain a home at an affordable price.
We also put together a list of low-income home loans, with affordable mortgage options and education programs to help single moms who want to own a home.
And if you’re not quite ready to commit to homeownership, read our guide on how to get free housing or an apartment for single moms.
Check out these other resources for low-income single moms and other individuals: