From the HUD website
http://www.hud.gov/offices/adm/grants/fundsavail.cfm#grants here are the available grants on housing. Check if you can qualify for any of them
Assisted Living Conversion Program for Eligible Multifamily Projects
Brownfields Economic Development Initiative
Community Development Block Grant Program for Indian Tribes and Alaska Native Villages (ICDBG)
Community Development Technical Assistance (TA)
HOME TA
CHDO (HOME) TA
Homeless TA
HOPWA TA
Youthbuild TA
Fair Housing Initiatives Programs Fair Housing -- Private Enforcement Initiative (PEI)
Fair Housing -- Education and Outreach Initiative (EOI)
Healthy Homes and Lead Hazard Control Programs Healthy Homes Studies
Lead Technical Studies
Healthy Homes Demonstration
Lead Hazard Control Program
Lead Outreach Program
Operation Lead Elimination Action Program (LEAP)
Lead Paint Hazard Reduction Demonstration
Housing Choice Voucher Family Self-Sufficiency (FSS) Program Coordinators
Housing Counseling Programs Housing Counseling -- Local Housing Counseling Agencies
Housing Counseling -- National, Regional, and Multi-State Intermediaries
Housing Counseling -- State Housing Finance Agencies
Housing Opportunities for Persons with AIDS (HOPWA)
Public Housing Family Self-Sufficiency
Public Housing Neighborhood Networks
Resident Opportunity and Self-Sufficiency (ROSS) Programs Resident Services Delivery Model - Ederly and Persons with Disabilities
Resident Service Delivery Model - Family-Homeownership
Rural Housing and Economic Development
Section 202 Supportive Housing for the Elderly
Section 811 Supportive Housing for Persons with Disabilities
Self-Help Homeownership Opportunity Program (SHOP)
Service Coordinators in Multifamily Housing
University and College Programs Historically Black Colleges and Universities (HBCUs) Program
Hispanic-Serving Institutions Assisting Communities (HSIAC) Program
Alaska Native/Native Hawaiian Institutions Assisting Communities (AN/NHIAC) Program
Tribal Colleges and Universities (TCUP)
Youthbuild
To apply for any of the above grants, you need to go to Grants.gov
http://www.grants.gov and follow their instructions on how the individual can apply for a grant
The 14.247 HUD Self-Help Homeownership Opportunity Program grant
http://12.46.245.173/pls/portal30/CATALOG.PROGRAM_TEXT_RPT.SHOW?p_arg_names=prog_nbr&p_arg_values=14.247 is the most promising for your purposes but its aim is
"To facilitate and encourage innovative homeownership opportunities through the provision of self-help housing where the homebuyer contributes a significant amount of sweat equity toward the construction of the dwellings."
which means you have to buy a rundown property and fix it, and the grant only gives $15,000.
You may want to check further with Catalog of Federal Domestic Assistance which is the database for all grants