Athen Apaquette

Can a person on disability qualify for a home loan?

You betcha!

I received a call today from a lady who was referred by her sister, a long-time fan of mine who refers at least 2 people per year to me for new loans or refinance loans. This lady had gone to her local bank and been turned down for insufficient proof of income. Her house is worth $600,000 and her loan request was $250,000 to pay off the loan and some credit card debt that she got while living off credit waiting for her disability benefits to be approved. The bank had said that because she does not have regular income, they could not approve her for a cash out loan. They would only approve her to refinance her current loan with them and lower the payment slightly, but the debt was what was causing her to struggle.

So her sister told her to call me, since I had done a loan recently for a disabled friend of hers. She did come in to see me, out of desperation, thinking I would say no as well. She came in, and I explained to her how her income, since it is permanent disability, can be counted as income (temporary disability cannot) and because it is not taxed, we do a thing called grossing up which is figuring out the gross before tax equivalent to the net (untaxed) amount she gets. This qualifies her for a little more than the bank would give her. YEAH! She is now debt free and keeps her house since the house payment is in her budget.

If you know anyone who is on disability or fixed income and wants to refinance their home, have them call me for a free look at the possibilities. Money is cheap right now, but won’t be forever.