Family Selection Process Overview


Our purpose

·         Improve affordable housing conditions

·         Work in partnership with other community agencies to address affordable housing needs

·         Provide long term, no interest loans to those who qualify

·         Empower community members through educational programs


Who Qualifies for a Habitat for Humanity Home?

·         Income is 30% to 50% of Area Median Income

·         Demonstrates a serious need

·         Applicant has the ability to repay costs

·         Willingness to partner with affiliate through 500 hours of sweat equity

·         Resident of Merced County 1yr. min



·         Present housing is not adequate

·         Unsafe or unhealthy living conditions

·         High cost burdens

·         Overcrowding


Ability to Pay

·         Proof of steady income

·         Complete and full disclosure of financial status

·         Debt to income ratio

·         Credit history is considered

·         Inaccurate or partial information is grounds for disqualification


Willingness to Partner

·         Sweat Equity – 500 hours minimum

·         Ability to take on homeownership responsibilities

·         Providing timely and complete information

·         Public nature of the program


Where Does Habitat Build?

·         We believe that location matters.  We choose to build in neighborhoods that have available and affordable lots, as well as active community groups organized around issues of empowerment. 


Location Discretion Policy

·         Habitat serves the eastern part of Merced County.

·         It is our goal to build homes in all the communities in eastern portion of our county.


Home Design

·         Basic, “No-Frills” Housing

·         Average Living Space:

·         900 square feet for a two-bedroom house

·         1,050 square feet for a three-bedroom house

·         1,150 square feet for a four-bedroom house

·         Limited Design Options


Buyer's Design Option

·         Buyer preferences are limited to accommodations for disabilities

·         The next house built will have three bedrooms.

·         Usually, families are asked to assist in the selection of flooring and paint colors


How Does Habitat Set the Price?

·         All building costs are tracked

·         No profit is taken

·         No interest is charged

·         An affordable mortgage is calculated which is comprised of the principal + taxes and insurance

·         $500 down payment is required Down payment can be accumulated in small increments as house is built


Resale Restrictions

·         Habitat has the first right of refusal

·         Shared appreciation occurs over loan payoff period

·         Long term commitment

·         Borrowing against equity in the home is not allowed


Partnership Responsibilities

·         Sweat equity

·         Timely payments

·         Continuing partnership

·         Owner occupied housing – house cannot be used as a rental


Sweat Equity 101

·         60/40 rule:  partnering family has to do 60% of the work and their friends & family can do up to 40%

·         No children under 16 allowed on the job site on construction crews can help clean-up etc.

·         Child care provider hours are counted toward sweat equity

·         Attending useful educational classes earns 2 for 1 sweat equity hours

·         Sweat Equity hours must be on a building site, unless other accommodations are required


Application Process

·         Application completed in full

·         Give second address, must be able to contact you if eligible.

·         Attachments for income verification

·         Photocopies only; originals will not be accepted; we will not make copies

·         Application Deadline two weeks from orientation session.

·         Incomplete applications will not be considered.

·         Home Visit limited to those who pass through initial assessment

·         Written Response from Habitat for Humanity on incomplete documents or disqualification

·         This is a long & tedious process – be patient


Application Attachments

·         1.- Two most recent wage stubs for all adult wage earners

·         2.- Verification of other income sources (SSI, TANF,AFDC,etc.)

·         3.- Copy of 2013 & 2014 filed Federal tax return with all attachments

·         4.- Copy of 2013 & 2014 W-2’s/1099’s for all adult applicants and household members

·         5.- Copies of last month’s utilities (electricity, gas, telephone, etc.)

·         6.- Copy of rental agreement or rent check

·         7.- Copy of bank statement



Common Misconceptions

·         Habitat is a “give-away” program

·         500 sweat equity hours is easy to do and you’re only responsible for working on your own home

·         Habitat never repossesses a home

·         Once you’re in a Habitat home, your obligations are limited to mortgage payments

·         There are loopholes in the application process or that any one individual has preference

·         Someone can get rich quickly when they purchase a home from Habitat