Interested in homeownership?

Here are the first steps.

Pre-Qualification

  • Preliminary Interview: The Home Trust’s representative will discuss the organization’s mission and explain the Community Land Trust model of homeownership. They will also review your financial information and go over the complete qualification and application process. These steps allow us to determine your mortgage readiness. In addition we can answer any questions you might have.

  • Submit your completed application: Contact the Home Trust about dropping off your application.

  •  Obtain a Credit Report including a FICO score:  You can provide your own current three-in-one credit report or we can help you obtain one for a minimal fee.  

  • Attend an Orientation Session: These sessions are designed to introduce you to the responsibilities of living in a Community Land Trust (CLT) neighborhood.  Please note: In a CLT, each homeowner is restricted in their use of the land by the ground lease agreement, and each community is guided by “Conditions, Covenants and Restrictions” (CC&Rs). Questions and discussion of issues of concern to you is included in these sessions.

  • Review a copy of sample CC&Rs:  Each neighborhood is unique. It is the residents themselves who decide what rules and restrictions will guide their neighborhood. It is important to take time to review the CC&Rs to get an idea of what your neighborhood will feel like.

  • Pre-Purchase attendance required at two neighborhood meetings

  • Complete the Washington State Housing Finance Commission Homebuyer Education Seminar 

Commitment Agreement

Once qualified, the next step to homeownership is completion of a Commitment Agreement with the Home Trust. The Commitment Agreement defines the actions you agree to take in order to remain on the waiting list, and the actions that the Home Trust agrees to take in order to provide you with a home to purchase. If you fail to meet the commitments defined, you will lose your place on the waiting list.

Mortgage Application

If you meet all the conditions of your Commitment Agreement and have signed a purchase agreement, you then submit a mortgage application to a private lender or USDA Rural Development with guidance from the Home Trust. They will request more detailed information such as employment verification and a more thorough credit report, and they will make the final determination about your financial qualification. If they determine that you are ineligible, your commitment fee paid to the Home Trust will be refunded, and we will work with you to become eligible in the future.

Eligibility

  • To be eligible for a Home Trust home you must reside or work in San Juan County.

  • You must be able to demonstrate the ability to make a living in the islands. Your household income must be sufficient to pay your monthly mortgage, taxes and insurance. Eligibility for a subsidized home requires your total annual household income to be less than 80% of Area Median Income (AMI for a family of 4 is $89,600) for your household’s size. Below are the 2022 maximum gross incomes by household size for a subsidized home:

    Number of People in Your Household

    Low-income designated

    • 1 – $48,850

    • 2 – $55,800

    • 3 – $62,800

    • 4 – $69,750

    • 5 – $75,350

    • 6 – $80,950

    Moderate-income designated

    • 1 – $70,265

    • 2 – $80,270

    • 3 – $90,275

    • 4 – $100,280

    • 5 – $108,330

    • 6 – $116,380

  • You must have a good credit rating showing no significant delinquencies in the past year and no bankruptcy in the past three years. We will run a preliminary report for you to see if there are any areas needing attention. The mortgage lender will run their own report when we submit the mortgage application to them.

  • At the time you apply for a mortgage your total debt (including the cost of your house) may not exceed 41% of your income (depending on your annual income and the type of mortgage for which you qualify). Debt includes any long-term obligations (a repayment period of more than 6 months). Examples of debt include car & student loans, child support payments, and credit cards. A Home Trust representative can help you determine your debt to income ratio during your initial screening interview. The ratio of your mortgage debt to your monthly income must be less than 29% if your income is very low or 33% otherwise.

  • You must have proof of steady employment or income for at least one year. Sources of income include all wages, overtime, and tips; interest and dividends; social security, annuities, pensions; unemployment, disability and severance compensation; alimony, and child support; and most forms of public assistance. Self-employed individuals must demonstrate proof of earnings with tax returns for the past two fiscal years.

  • If you have assets valued at more than $10,000, you may be required to use them towards your down payment. Assets include such things as a savings account, real estate, a mobile home, recreational vehicles, boats, art collections, or similar items. Household possessions, cars, and Individual Retirement Accounts (IRAs) or pensions are not included in your asset calculation.

If you are not eligible, how can you become eligible?

Having too much debt is the most frequent reason for ineligibility. If you meet all other eligibility and pre-qualification requirements, but think you have too much debt, we encourage you to come in and talk with us. We will review your financial situation, assist you with budget planning and find other ways to help you work towards eligibility.

If you currently own a home, you must sell it before applying with a lender for a Home Trust mortgage. You will be limited in the amount of cash you can retain without contributing to the down payment. Some of our buyers, with sufficient cash but little income, have bought their homes outright, with no or very little mortgage.

If your household’s total income is greater than 80% of area median income, you may be eligible for a home that has no Federal or State subsidy, if any are available.

Please call 360-378-5541 to make an appointment to review your individual circumstances.

Check out our eligibility requirements to get onto our waitlist and into a Home Trust home.