Financial Requirements for a Habitat Home
Habitat works with people interested in homeownership who do not qualify for a traditional
mortgage from a bank or credit union. They must have sufficient income from reliable sources to
make monthly payments to Habitat that might range from $700-$850 for the life of a 25-35 year
interest-free mortgage. The monthly payments include the mortgage, property taxes and property
insurance. Habitat limits the total of those three expenses to 30% of a homeowner partner’s
income.
Do you have too much or too little income to qualify? If your income falls within these ranges,
you might be a good fit for a Habitat home.
Family Size
_____ Family of 1
_____ Family of 2
_____ Family of 3
_____ Family of 4
_____ Family of 5
_____ Family of 6
_____ Family of 7
_____ Family of 8
$28,000/year $36,120/year
$28,000/year $36,120/year
$28,000/year $40,670/year
$28,000/year $45,150/year
$31,000/year $48,790/year
$34,000/year $52,430/year
$34,000/year $56,000/year
$34,000/year $59,640/year
*These figures are based on a 30 year mortgage. In some cases, mortgage terms could be extended and
minimum income figures could be a bit lower. The length of the mortgage is determined by each
homeowner’s annual income.
Other financial factors besides income are carefully reviewed by the Selection Committee:
Your credit score needs to confirm that you pay your bills. How you manage your money is as
important to Habitat as how much you earn. Everyone is entitled to check their score at no
charge with each of the three agencies every year. Sometimes mistakes are made, and it is
important to take advantage of this opportunity to fix mistakes. You can get your free credit
score by going to https://www.annualcreditreport.com.
Applicants need to be able to show that their expenses do not exceed their income, and that they
are able to set aside a reasonable amount of their monthly income as savings. Monthly payments
for long-term debt (car loans, student loans, alimony, child support, credit card debt) should not
be higher than 40% of your monthly income. Matching up your regular monthly expenses with
your regular monthly income is a good way to determine how much money you would have
available for other needs and to set aside in a savings account. We suggest you complete the
budget worksheet that follows to assess your financial readiness for home ownership.
Even if it appears that you don’t meet all of the financial qualifications, it is important to not give
up on your dream. We will work with anyone who is serious about homeownership and who is
willing to take the necessary steps to meet our financial qualifications. Please call 802-367-1000
and discuss ways that we can work with you. Your call could be the start of a very positive and
special relationship that could change your life and that of your family.
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BUDGET WORKSHEET
Creating a monthly budget is an important step. Keep in mind that many typical expenses are
not listed. These expenses often use up quite a bit of income. To be in good financial shape, you
should be able to set aside a reasonable amount of your income each month as a reserve fund.
Some of your current sources of income may not be “counted” if you become a Habitat
applicant because they would be considered short-term or unreliable. Habitat has to take into
account that you would be taking out a long-term mortgage. Non-countable income sources
would definitely include rent subsidies, but might also include disability, SSI, alimony,
unemployment, and child support—depending on the nature of the disability and the age of the
recipient, the age of the child, and other specific circumstances. When determining your income
for Habitat, count these supplementary income sources only if are guaranteed for five years or
more.
Some of your regular expenses are not paid on a monthly basis. For example, insurance
payments might be once a year or quarterly. To get an accurate monthly cost, take the total yearly
bill and divide it by 12. List that amount below.
REGULAR MONTHLY INCOME SOURCES
______Employment (List total, regular income for all adults 18 and older in the household.
If work is seasonal, estimate a monthly average)
_____ Social security ____Disability ____Unemployment ___ Child support _____ Alimony
Other regular sources of income? Add source and amount to above list. Do not list food stamps
or fuel assistance.
Total regular current monthly income ____________
PREDICTABLE MONTHLY EXPENSES
LOANS—
monthly payment
balance
Car loan(s)
________
_______
Student loans ________
_______
Credit Card (s) _________
_______
Personal loans _________
_______
Other loans
_________
_______
_______ Rent + renter’s insurance
_______ Child care
_______ Mortgage, property taxes and insurance
_______ Child Support
_______ Electric
_______ Alimony
_______ Heating
_______ Credit Cards
_______Water
________ Health insurance
_______ Trash removal
_______ Regular medical expenses
_______ Food
_______ Life insurance
_______ Gasoline
_______ Phone, TV, Internet
_______Car payments
_______ Appliance/furniture rentals
_______Car insurance
_______Other regular expenses (explain)
Total predictable current monthly expenses ____________
Total income minus total expenses = money available each month for other needs /savings:
$______________________
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