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An Introduction to Loans for Single Mothers

Financial aid and loans for single mothersare available from many resources, including the federal government, non-profit, private and public organizations. Many loan programs are specifically designed to assist single mothers with special features such as low interest rates and installment plans with long repayment durations.

Know Your Credit Score

Before starting a loan search, find out what your credit score is. Your credit score will be part of the equation that any financial institution will use to assess your ability to repay a loan. Credit scores also determine the kinds of loans that you may be eligible for. Below is an outline of some of the types of financial assistance that may be considered.

What is a Secured Loan?

A secured loan requires collateral, such as a car, a home or other property. The amount of money lent becomes the debt, which is then secured against the collateral. Should the borrower default, the creditor can take possession of the collateral. These loans are a good option if you are able to pay off the loan timely.

Bad Credit

Banks sometimes offer special programs that cater to established customers. The interest rates and payments are usually higher, but credit risk loans can help to establish better credit so that after the loan is paid, it is possible to renegotiate for lower rates with a higher credit score.

Small Business Loans

The Small Business Association offers information on all kinds of funding options, from start-up and entrepreneur business loans to government and private grants.


The United States government sets aside funds for single mothers in the form of grants. While applying for a grant can be complicated, one of great things about grants is that they don't have to be paid back.

Real Estate and Home Loan Resources

  • Housing Choice Vouchers Program. Designed to provide vouchers to assist in making mortgage payments, this program is managed by individual states. Each state qualifies single mothers for the program if their income falls into what is considered a lower bracket for that particular state.  

  • Housing and Urban Development Program ("HUD"). Families that may not normally qualify for conventional loans can often find many opportunities for lending in HUD. This kind of loan is particularly desirable since it is guaranteed by the government, which lessens lender risk considerably. 

  • Housing Finance Agency Program. This program offers down-payment assistance to people with lower incomes. The Housing Finance Agency is run by each state individually. Those interested can check directly with each state about qualifications. 

  • State-Specific Programs. States often sponsor down payment assistance to first-time home buyers. Contact government offices for programs offered in each particular state. 

  • Credit Unions and Banks. Local credit unions and banks often have special programs designed for first-time home buyers and offer options for families that normally don't qualify for a conventional loan. 

Avoid Internet Scams

The Internet provides a vast amount of useful financial information. Regardless of what kind of financial assistance is being sought, always consider the source of the information when researching for loan opportunities.  

Watch out for various websites that can appear to be similar to government websites. Some firms may attempt to charge fees to "expedite" the grant or loan process. Ensure that you check with the Better Business Bureau and other consumer websites prior to doing business with any company asking for money, since some of them are merely scams.

As a cautionary measure, have a financial advisor, pro-bono lawyer, or someone you trust review the contract before you decide to do business with any agency or company offering a loan.

More information on small business loans for women and government grants is available at

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