Click to navigate:
- Can I Get a Loan While on Disability?
- Can I Buy a Home on SSI or SSDI?
- How Do Lenders Look at Disability Income?
- What Home Loans Are There for People on Disability?
- Homeownership Could Be Within Reach
Can I Get a Loan While on Disability?
Yes. It is illegal for a lender to refuse to consider qualifying income simply because it comes from disability benefits or other types of public assistance, per the Equal Credit Opportunity Act.1 The Consumer Financial Protection Bureau also specifically warns lenders against creating unlawful verification hurdles for borrowers who receive Social Security disability income.2
In other words, your disability income can be used in the qualification process for a home loan.
Keep in mind: Lenders consider not only your income when deciding whether you qualify for a loan, but also weigh in things like your credit history, debt-to-income ratio and other financial factors.
Short answer: Yes.
Let’s break it down by first understanding the difference between these two benefits:
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Supplemental Security Income (SSI): This federal program gives financial assistance to people unable to work either due to their age (65+) or a disability. You do not need to have a work history to qualify. This assistance is meant to cover basic needs such as food and housing, and is meant for those with limited resources.3
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Social Security Disability Insurance (SSDI): This federal program gives financial assistance to those with a disability. The amount received depends on the recipient’s work history before the disability began.4
In either case, both programs are considered income by Newrez and other lenders and may help qualify you for common purchase loan types such as FHA, VA or USDA or Conventional. Note: Your benefits may not be eligible if they are set to expire within three years of you submitting a mortgage application.
A loan application that includes on disability income should be treated like any other lawful income-based application. Lenders may review income stability, total debt, monthly payment burden and credit profile when considering whether you qualify for a loan.
The right loan for you will depend on a variety of factors, including your overall financial profile and the value of the home you’re hoping to buy. If you have limited funds to make a down payment or you have less-than-perfect credit, you may still be able to qualify for a loan that can flex to your needs.
Here are several common home loan types that we carry:
Conventional Home Purchase Loans
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Minimum credit score 580
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You may be able to put down as little as 3-5%
FHA Home Purchase Loans
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Down payments as low as 3.5%
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We accept credit scores of 580 or above
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Requires upfront and/or annual mortgage insurance premiums
VA Home Purchase Loans
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Available to eligible Active-Duty Military, Veterans and surviving spouses
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No down payment required for eligible borrowers with full entitlement
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No private mortgage insurance (PMI)
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We accept credit scores of 580 or higher
USDA Home Purchase Loans
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0% down payment options available
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Lower mortgage insurance costs compared to some other programs
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Household income must be below 115% of the area median income
