About Low-Income Home Improvement Loans
Home-improvement loans for people with low incomes are readily available through government-sponsored programs and local nonprofit organizations.
Qualifications
Low-income means that your income levels are lower than the median income for your area (state, county or city). Some loan programs vary based on a percentage of median income. For instance, when a lender offers a "20 percent median income" loan, that means you need to make 20 percent of the median income or less. If you make more than that, you will not qualify.
Proof
To prove that you qualify, you will have to show the lender your tax returns and W-2s from the last two years. They will compare these numbers with the published median income figures for your area and determine the best program to fit your needs.
Interior vs. Exterior
Most loan programs for low-income homeowners are reserved for interior rehabilitation and bringing the house up to local building code. The goal is to ensure the home meets the minimum allowable standard of living.
Exterior repairs and additions, like adding a new bedroom or refinishing vinyl siding, are typically larger, more expensive projects and require a more significant construction loan through commercial lenders.
Disaster Loans
HUD has made available, through its local lending partners, loan programs for low-income homeowners to make repairs on immediate safety hazards and to install necessary items like broken windows, moldy walls and leaky roofs. These loans are offered at extremely low interest rates and with relaxed underwriting guidelines so low-income residents don't have to wait for long loan approvals.
Seniors and the Disabled
Many disabled and senior homeowners qualify for low-income home improvement loans because they are receiving fixed incomes, like disability payments or social security, that often fall below the median income levels. In both cases, HUD offers loans for these residents to make their homes more accessible.
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