Over the weekend, Realtor.com told the heartwarming story of a working mom in North Carolina, earning $45,000 annually, who bought a $350,000 house with no down payment. How's that possible? She was helped by Habitat for Humanity.
That's a global nonprofit with projects in communities across all 50 states and abroad.
Readers may remember that Habitat for Humanity's most prominent supporter was the late President Jimmy Carter. He, normally accompanied by his wife Rosalynn, donated one week of site labor to the organization each year for 35 years.
How Habitat for Humanity Works for Homebuyers
Providing labor (mostly on-site) is central to how Habitat for Humanity works. Prospective home buyers build up "sweat equity," mainly by working alongside volunteers on their own or other people's homes. Our single mom in North Carolina gave 200 hours of labor: after work, on weekends or during vacation time. New homes may be built or existing ones rehabilitated.
"Sweat equity is a transformational experience for families and a cornerstone of our homeownership program," says Sonia Lee, director of homeowner and mortgage services at Habitat for Humanity International, in a statement. "The skills and knowledge gained through activities like volunteering on a build site or taking financial literacy classes help set new homeowners up for success long-term."
Who Qualifies for Habitat for Humanity Assistance?
Applicants for Habitat for Humanity (let's abbreviate that to H4H from now on) must want to live in a place where H4H has an active project. Besides that, the eligibility criteria include:
- Applicants must be in need of safe, affordable housing — Their existing accommodation must be substandard for their needs. Accessibility issues are relevant for those with disabilities.
- They must be on a moderate or low income — Specifically, they cannot earn more than 60% of the area median income (AMI). Look up the AMI for a particular address here.
- Applicants must be willing to provide hundreds of hours of unpaid labor and undertake a homeowner education course.
- They must be able and willing to pay an affordable mortgage — H4H ensures that monthly mortgage payments are less than 30% of an applicant's gross (pre-tax) monthly income. Like all lenders, the organization will need to verify applicants' income, employment record, credit score, debt-to-income ratio and so on before agreeing to a mortgage
How to Participate in H4H
Those interested in working with H4H should reach out to their local program. The organization has a look-up tool to locate the nearest ones. Decisions about who can join are made at that level.
Normally, such an approach will lead to an invitation to attend a real-world information session. There, hosts explain the program in more depth, explain the application process, and answer questions.
If candidates like what they hear at the information session, they can go ahead and apply.
Of course, anyone can follow in President Carter's footsteps by volunteering their labor altruistically. Readers should contact their local project.
And the website's Support page facilitates financial donations. "Every gift helps a family build a foundation."
