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With the big downturn of the global economy, more and more families are desperate to find low income houses for sale. Because of people getting laid-off their jobs, finding it very hard to find another job, and basically just not earning enough to support himself/herself and the family, people nowadays are becoming more practical with where they invest their hard-earned money.

Most people who are looking for low income houses for sale are the ones tired of paying never ending rental fees. Purchasing a house is a huge financial investment, especially for those with below average income. And it is important that even with limited budget, people should still get their money’s worth with their house.

Proper Savings and Preparation

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Purchasing low income houses for sale are still a huge investment and a big decision to make in your life. Therefore it is just imperative that you do as much discernment and weighing in of options as you can before deciding to hand-in your savings for a house.

Before cashing in your life’s worth of savings, be sure you have enough. Owning a house costs far more expensive than by just merely renting it out. Down payments for houses usually cost around 20% of the actual value, and after which, monthly mortgage begins. There should also be enough money set aside for possible repair costs that may come up.

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If you intend to apply for a mortgage loan from a bank, carefully plan out possible expenses monthly and check whether or not you can actually pay the monthly dues. Also, banks will surely check your credit score as basis for the approval of your loan. Banks will be more hesitant to lend if you have low income, however, you can compensate for it by having a good credit score. Lessen your debts, or diminish it completely before you apply for a loan. Banks can easily overlook your low income once they see that you are responsible in paying your debts as soon as possible.

And after you have planned how you will pay for your house, it is much more important to still have enough money left to use for everyday needs of you and your family.

 Choosing the Right House

In order to cater the needs of low income families, more and more real estate firms and agents are choosing low income houses for sale. Families nowadays tend to be more practical and less indulgent in unnecessary luxury. 

Before thinking of borrowing money from the bank for mortgage, you must first have a clear vision of the possible options wherein you will want to buy a house. Look at as many options as possible and make sure to keep the price within your range and capability to pay.

Applying for Mortgage Loans

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Before proceeding to how to actually applying for a loan for low income houses for sale, you must first know the three types of low income mortgage assistance.

First of the three types of low income mortgage assistance is Mortgage Insurance. Mortgage Insurance makes it easier for low income borrowers to qualify because a federal government, such as the FHA and VA, insures the mortgage loan made by a private lender, such as banks. With this kind of assurance for private lenders, low income borrowers are easily approve because they have a sure back-up in case they are not able to pay the monthly mortgage.

The second type of low income mortgage assistance is Direct Lending. A government housing agency program, such as the USDA rural housing program, will grant loans directly to low income borrowers without going through a private lender.

And lastly, the third type is Grant Programs. This is when a non-profit or government agency gives a monetary grant to the low income borrower.

Low-Income Mortgage Programs

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After knowing the three types of low income mortgage assistance, it is important then to be familiar with concrete programs which use at least one of the three types of low income mortgage assistance. These programs will be of much help in knowing your concrete options upon purchasing low income houses for sale.

State-Sponsored Programs are an example of a concrete assistance program to help low income house buyers. There are various state-sponsored programs for every state, which may come in the form of counselling, direct financial aid or monetary grants. It would be wise to first browse through all possible options within the state you are looking to buy a house and assess if any of those programs may be of use to you.

Another program, which features a Mortgage Insurance type of loan, is the Federal Housing Administration (FHA) Loans. Through this program, the FHA insures housing loans made by private lenders or banks. In cases wherein the borrower will not be able to pay the mortgage or if he/she has cancelled it, the lender gets reimbursed by the federal government. Take note that this program is not limited to low-income borrowers, it just applies to their situation much better.

If you intend to buy a house within the rural area, the USDA or Rural Housing Loans may be of use to you. This applies to those falling within the “low” and “very low” income, which corresponds specifically to government’s specific definitions. These programs allows stretching of a term in which the borrower is required to pay; the term can reach up to 38 years depending on the borrower’s paying capacity. However, it is just right that only modest houses by local standards are allowed to be purchased within this program.


There are various options, which you can consider before pushing through in buying low income houses for sale. Since you are in a much tighter budget, it is important to carefully scrutinize whatever options you have got and consider which one would benefit you the most long-term.

Aside from these options and before you finalize the program you can use in buying low income houses for sale, you may want to attend counseling sessions as well, in order to gain professional advice wherein you can really have knowledge of the pros and cons of all your options. Remember that you are putting your hard-earned money on the line for this and there’s no room for errors or wrong decisions.