What are advantages and disadvantages of owning a home?

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Good things about homeownership:
  • You become wealthier when your home goes up in value.
  • Owning a home has tax advantages because mortgage interest and property taxes a homeowner pays are generally deductible from income taxes.
  • You can prevent your monthly payments from ever going up if you get a fixed-rate mortgage.
  • Homeownership lets you have more personal autonomy and put down roots in your community.

Difficult things about homeownership:

  • You have additional responsibilities ranging from more paperwork to dealing with repair people.
  • You have to pay your mortgage on time every month and pay insurance and property taxes.
  • You have to take care of maintenance (upkeep of your home to make sure it stays in good condition).
  • It is more complicated if you want to move and live somewhere else because you would need to sell your home.

How can I find a realtor?

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Try to get a reference for a realtor from a person or organization you trust. You may be able to locate a realtor who specializes in helping people with disabilities purchase their first homes by asking at an Independent Living Center or other local disability organization. You can also try asking your friends, neighbors, and other people you know who have purchased a home. Finding and working with the right realtor is critical for your home-purchase team.

Is a realtor really that important when you want to buy a home?

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Yes, the right realtor can make all the difference. A good realtor will know not only the best neighborhoods in your price range, but also what special programs a city, county, or state may have to help first-time or low-income homebuyers be successful. Your realtor should have experience working and combining these programs to help you reach your goal of homeownership. A realtor works for you and should help find the right house, in the right neighborhood, within your price range. It is important to realize that not many realtors may have experience working with someone with your specific disability. Therefore, it is up to you to clearly explain your access and location needs.

What is a credit score?

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Your credit score is a measurement of how well you pay your bills. If you don’t pay your bills on time, don’t make the minimum payments, or go over your credit limit, your credit score will go down. Your credit score is very important to lenders because it allows them to evaluate if you are a “good risk.” If they are going to lend you potentially hundreds of thousands of dollars so you can buy a home, they want to be as certain as possible that you are going to make the agreed upon payments each month.

The bottom line: You won’t be able to get a loan to buy a home if you have a history of not paying your bills.

If I get Supplemental Security Income (SSI), can I still own a home?

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Yes, even if you get Supplemental Security Income (SSI), you can own your own home. SSI has a rule that allows people who get SSI benefits to own a home without having that count as a resource. This is important because SSI has a strict resource limit that usually means that if you have more than $2,000 in resources, you can’t get benefits. The house you live in is one of the exceptions to this rule.

If I get Supplemental Security Income (SSI), how can I save up enough money to make the down payment on a home?

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Supplemental Security Income (SSI) has resource limit requirements that make it difficult to save money toward homeownership, but there are options, such as opening an Individual Development Account (IDA) or using a local government assistance program. These help people getting benefits achieve their savings goals. The most important thing to remember is that there are many ways to structure the purchase of a home, even if you are getting SSI benefits. The key is finding a good realtor who knows about the different programs that are available. You can also talk to a Work Incentive Consultant to learn more about how you can purchase a home without losing your SSI benefits.

I don’t have much money to put toward a down payment. Are there programs to help people with low income become homeowners?

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Yes, there are many kinds of programs that help people in becoming homeowners. Most of these programs are designed to help first-time buyers or people with low to medium incomes. These programs vary greatly, and they can be run on a local, county, state, or even federal level. A good realtor should know about all the different programs in a specific area and be able to direct you toward programs for which you qualify. Such incentive programs may include help with a down payment or closing costs; lower interest financing; more tolerant loan underwriting criteria, debt forgiveness, real estate rehabilitation credits; or financial help for single-parent households.

Note: You may qualify for several programs and many of them can be combined to give you significant savings. Try searching the Internet with the name of your town, city, county, or state to see if you can find local homeownership programs.

How can an Individual Development Account (IDA) help me purchase a home?

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An Individual Development Account (IDA) is a matched savings plan for people with low income. IDAs are offered by nonprofit agencies in some Arizona communities. When you open an IDA, a special bank account is set up, and as long as your IDA is federally funded, all the money that is deposited into the account does not count towards the $2,000 resource limit ($3,000 for couples).

For most IDAs, the nonprofit agency will match your contribution when it comes time to make the down payment on your home. For example, if you put in $25 per month, they may also contribute $25 to your down payment, or perhaps even more. This makes them a fantastic way to save! Not only are the funds protected, you get your funds matched when you are ready to purchase a home, meaning you’ll have way more money for your down payment or closing costs.

An additional benefit of an IDA program is that participants get to take advantage of credit repair and financial education instruction related to homeownership. These mandatory classes are a fantastic additional resource for first-time homebuyers and result in very high homeowner success rates for IDA participants.

I haven’t owned a home in years; might I still qualify for one of the first-time buyer programs?

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Yes. Despite their name, many first-time buyer programs are open to people who have owned a home in the past. It is important to check with each program specifically, but generally speaking, if you haven’t owned a home in the last 2 – 3 years, you will probably qualify for some of the first-time owner programs. Once you qualify for the program, check with your bank and other local programs to see if there are other discounts, credits, or educational opportunities for which you may qualify.

What is the Section 8 Homeownership Program?

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Section 8 is a federal program that usually helps people and families with low income pay their rent. However, in some areas the local Public Housing Authorities (PHAs) also help some people buy a home with Section 8. When Section 8 helps you buy a home, the federal government will pay most of your mortgage each month. You will also have to pay part of your mortgage. If you buy a home with the help of Section 8, when the mortgage is paid off completely, you will be the full owner of the home and the government has no further involvement! Find local public housing authorities (PHAs). Not all PHAs offer the Homeownership Program, so make sure to ask.

What happens if I buy a home and can’t afford the mortgage?

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If you are having trouble paying your mortgage, the first step to getting help is to call a foreclosure hotline:
  • The Arizona Foreclosure Prevention Helpline can be called at 1-877-448-1211.
  • The Homeowner’s HOPE hotline is a national hotline with counselors available 24 hours a day, 7 days a week. Its phone number is 1-888-995-HOPE (4673).

These hotlines have experts who will answer the phone and give you information about what you can do to keep your home.

For more information about mortgage assistance, see DB101’s Housing article.