Ability to Pay: Debt and Credit
Not only is the Ability to Pay determined by income, a Habitat application also requires a look at the applicant’s debt and credit.
Please see below for more information on the debt and credit obligations.
Applicants must meet debt-to-income ratios
Program Applicant’s current debt and income will be evaluated to determine eligibility.
A Habitat mortgage payment cannot be more than 30% of your gross monthly income.
After purchasing a Habitat home, the total of your monthly debt payments (including the mortgage payment) cannot exceed 43% of your gross monthly income.
How is your income determined?
The required median credit score is 620. This is determined from a tri-merge credit report.
- Applicants without credit scores: two credit references are required with no more than thirty days delinquent on two or more regular monthly payments.
- Applicants cannot have any “non-medical” charge offs/collections on any credit report.
- Applicants cannot have any bankruptcies or foreclosures in the past year and must be in good standing.