Best Grants for Building, Buying, or Repairing Your Home in 2021

By 

Michelle Delgado

Updated 

January 4th, 2021

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Building |  Buying |  Repairing

Whether you’re purchasing your first home or maintaining your current one, the expenses involved can quickly become overwhelming.

If you worry that safe, affordable housing is outside your financial reach, it’s worth investigating the many programs designed to help people access much-needed housing assistance.

In general, funding is prioritized for:

  • First-time home buyers
  • Low- and very-low-income home buyers or homeowners
  • The elderly
  • Veterans or active duty service members with disabilities
  • Native American home buyers or homeowners
  • Homeowners or renters impacted by natural disasters or other emergencies

If you think you might qualify for housing assistance, read on to learn more about options that may apply to your situation.

Program
Value
Who qualifies?
HUD’s 203(k) Rehab Mortgage Insurance
At least $5,000, or up to the cost of total demolition and reconstruction
Home buyers purchasing a fixer upper

Learn more
VA’s Disability Housing Grants
$7,256 to $100,896, depending on the type of disability and housing
Veterans or active duty service members with service-related disabilities

Learn more
DOE’s Weatherization Assistance Program
$4,695 on average, resulting in a mean savings of $283 on energy bills annually
Low-income households

Learn more
Fannie Mae’s HomePath
Up to 3% closing cost assistance
First-time home buyers who complete an online course and purchase a HomePath property

Learn more
National Homebuyers Fund’s DPA gifts and loans
Up to 5% of the mortgage loan amount
Any home buyer, plus homeowners looking to refinance

Learn more
HUD’s Revitalization Areas
Steeply discounted home prices, ranging from $100 to 50% of the listing price
Home buyers in HUD-designated locations

Learn more
USDA’s Rural Development Loans
0% down for home buyers
Home buyers or rehabbers in eligible rural locations

Learn more
HUD’s Section 184 Indian Home Loan Guarantee Program
A 1.25% down payment on loans under $50,000, or 2.25% down payment on loans over $50,000.
American Indian and Alaska Native families

Learn more
USDA’s Section 504 Home Repair Program
Up to $27,500 in combined loans and grants
Very-low-income households and elderly homeowners

Learn more
FEMA Housing Assistance
Varies by need
Homeowners and renters affected by natural disasters or emergencies

Learn more

Programs for Building or Renovating a Home

HUD’s 203(k) Rehab Mortgage Insurance

Though fixer-uppers are often available at affordable sale prices, renovation costs can quickly add up. HUD’s 203(k) Rehab Mortgage Insurance program is designed to help home buyers purchase and renovate a property — without the high interest rates and short timelines other loans demand.

The proposed repairs must cost at least $5,000, but can extend to total demolition and reconstruction (as long as the original foundation remains in place).

If your property qualifies, you can use this program to address a number of costly rehab projects, including structural alterations, improved energy efficiency, installing a well or septic system, and more.

VA’s Disability Housing Grants

If you’re a veteran or service member with certain service-connected disabilities, you may qualify for a U.S. Department of Veterans Affairs disability housing grant. These grants can help you buy a home, or renovate your current home to meet your needs.

Depending on your specific disability, you may qualify for one of two grants.

The Specially Adapted Housing (SAH) grant allows veterans and service members to buy, build, or renovate their homes. In 2021, the maximum grant amount is $100,896, or $40,637 if you’re living in temporary housing.

The Special Home Adaptation (SHA) grant also provides funding for purchasing, building, or renovating a home. In 2021, the maximum grant amount is $20,215, or $7,256 if you’re living in temporary housing.

If you receive either of these grants, you don’t have to use the funding all at once — it can be spread over up to six separate transactions over your lifetime.

DOE’s Weatherization Assistance Program

Each year, the Department of Energy (DOE) Weatherization Assistance Program (WAP) helps low-income households reduce their annual energy costs by $283 or more on average.

Though financial assistance varies by property, the average home receives weatherization measures worth $4,695.

Note that the program takes a “whole-house” approach to weatherization, often improving older homes’ overall safety. Along with energy-efficient improvements, participants might also receive help remediating mold, fixing roofing, or addressing other health and safety concerns.

Programs for Buying a Home

Fannie Mae’s HomePath Program

The HomePath ReadyBuyer program provides up to 3% closing cost assistance to first-time home buyers. To qualify, you’ll need to complete an interactive online course (available in Spanish and English) that will guide you through the home buying process.

The only catch is that this offer only applies to HomePath properties — foreclosed homes that are owned by Fannie Mae.

The National Homebuyers Fund DPA Program

The National Homebuyers Fund, Inc. DPA program offers assistance with a down payment and/or closing costs — two upfront expenses that many buyers struggle to afford. Home buyers can receive up to 5% of the mortgage loan amount, in the form or a gift or a 0% interest second mortgage that is forgiven after three years.

You don’t need to be a first-time home buyer to qualify, and you may also be able to apply the NHF DPA program to refinancing your home. It’s available nationwide and compatible with a variety of common home loans.

However, you will have to stay in your home for at least three years — so only apply if you’re not planning to move any time soon. You’ll also have to work with one of NHF’s participating lenders.

HUD’s Revitalization Areas

Located across the U.S., Revitalization Areas are locations designated by the Department of Housing and Urban Development (HUD) under the National Housing Act.

Single-family homes within these Revitalization Areas may be eligible for two programs that offer discounted sales:

  • Asset Control Area (ACA) program
  • Good Neighbor Next Door (GNND) sales program

Under the ACA program, the Federal Housing Administration is able to offer steeply discounted pricing on certain foreclosed properties. These homes fall into three tiers:

  • Properties appraised at $25,000 can be purchased for $100
  • Properties appraised at more than $25,000 but less than $50,000 are discounted by $24,900
  • All other properties are sold at a 50% discount of their appraised value

Under the GNND program, law enforcement officers, teachers, fire fighters, and EMTs are eligible to purchase homes at a 50% discount of the listing price (provided that the property is in a Revitalization Area).

USDA’s Rural Development Loans

The U.S. Department of Agriculture’s Section 502 Guaranteed Loan Program helps low- to moderate-income households buy, build, or renovate a home.

The program allows qualified applicants to purchase a home with no money down by providing a 90% loan note guarantee to approved lenders. To qualify, participants must purchase or own a home in an eligible rural area.

HUD’s Section 184 Indian Home Loan Guarantee Program

HUD’s Section 184 Indian Home Loan Guarantee Program provides financial assistance for American Indian and Alaska Native families, Alaska villages, tribes, or tribally designated housing entities. Today, eligible locations have expanded beyond tribal trust land.

The program allows Native borrowers to secure a home loan with a low down payment of 1.25% on loans under $50,000, or 2.25% on loans over $50,000. (Maximum loan limits vary by location.) This funding can be applied to buying, building, refinancing, or renovating your home.

All loans are 100% guaranteed by the Office of Loan Guarantee within HUD's Office of Native American Programs.

If you’re a Native American veteran, or a veteran married to a Native American, you may also qualify for the VA’s Native American Direct Loan (NADL) program.

Programs for Repairing a Home

USDA’s Section 504 Home Repair Program

The USDA’s Section 504 Home Repair program provides up to a $20,000 loan to very-low-income homeowners (defined as 50% below the area’s median income). Homeowners can use this funding to repair, improve, or modernize their homes.

Qualifying applicants who are 62 or older and cannot repay a loan may be eligible for a grant of $7,500. These funds can be used to resolve health and safety hazards.

If a qualifying applicant can repay a portion of their loan, they may be eligible for a combination of loans and grants totaling up to $27,500.

FEMA Housing Assistance

If your home is damaged by a natural disaster or other emergency, you may be eligible for housing assistance from the Federal Emergency Management Agency (FEMA).

Qualified applicants can receive funding for temporary housing, home repairs, or even home replacement. You may also qualify for help paying for a wide range of other disaster-related expenses, ranging from childcare to medical bills.

Keep in mind that this financial support only applies to needs that are not covered by insurance. Applicants will also need to verify their identity and ownership or occupancy.