How to Buy a Home on a Low Income: Programs and Options to Consider in 2025

Can I buy a house if I don’t make a lot of money? Yes, it’s possible to buy a house with a low income.

Many programs and loans are designed to help people who earn less, and lenders look at things like your credit score, debts, and the money you have for a down payment—not just your income.
 

How do I know if I qualify as low income?

The government says you are “low income” if your household makes 80% or less than the average income in your area (called Area Median Income or AMI). Family size also matters.

Use Fannie Mae’s online tool to check your status based on your ZIP code.
 

Programs That Can Help

There are several helpful programs for low- and moderate-income buyers:
 

• Fannie Mae HomeReady / Freddie Mac Home Possible: Let you buy with a 3% down payment. Money for the down payment can come from gifts or grants. These programs also offer lower monthly insurance costs.
• Down Payment Assistance (DPA): State and local agencies may offer grants or loans to help with your down payment and closing costs.
• HUD Homes: The government sells some homes at a discount, usually after foreclosure. These homes may need repairs and you must live there as your main home.
• Good Neighbor Next Door: Teachers, police, and emergency workers can get big discounts (up to 50%) on certain homes.
• Mortgage Credit Certificates (MCCs): Give you a tax break, helping you afford a larger loan.

 

Loans for Low-Income Buyers

Even if you don’t qualify for the above programs, there are government-backed loans with easier requirements:
 

• FHA Loans: Require as little as 3.5% down payment if your credit score is at least 580.
• VA Loans: No down payment needed (for veterans, service members, and some spouses).
• USDA Loans: No down payment, for buyers in certain rural areas; income limits apply.

Most of these loans also let you use money from gifts or assistance programs to help with the costs.
 

What Should I Do Next?

 

• Check your income bracket using the Fannie Mae AMI tool.
• Research local and national programs for home buying assistance.
• Compare lenders to find the program that fits your situation.
• Get help from professionals, like a mortgage broker or real estate agent, who know about these programs.

 

Bottom Line:

Buying a home with a low income is possible. There are many programs and types of loans that can help you afford a house, even if you don’t have much money saved up.

Start by looking at your local area’s programs and talking to lenders about your options.

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Find out if you're eligible for more housing support here!