Eligibility Requirements

Below is a list to test your eligibility. Satisfying all the criteria does not guarantee eligibility, but allows you to self-determine if you think you may be eligible for LCLT housing.

1. Minimum Two-Year Residency

     A minimum residency on Lopez of at least two years or an employment contract with a Lopez employer. Your household must be able to demonstrate the ability to support themselves in the islands.

2. Household Income

Your income eligibility will be determined by your previous two years Federal Tax Returns or signed, notarized statements.  The income of all adults in the household is included when determining eligibility, even if all adults are not co-op shareholders.  Sources of income include but are not limited to employee wages and benefits; tips; self-employment including royalties; interest and dividends; social security; annuities; pensions; unemployment, disability and severance compensation; alimony; child support; and some forms of public assistance. You must have a reliable stable income (seasonal is okay if it is consistent from year to year) that can support you locally.  You’ll need to earn enough to pay your share of the housing co-op’s monthly fees. These housing related costs must not exceed 34% of your income. Depending on the home you are applying for there may be a maximum AMI limit for households. Please contact LCLT to determine AMI limit. Use the table below to determine the AMI for your household size.  If you are self-employed, qualifying income is calculated after deducting any business-related expenses (i.e. the bottom of your Schedule C).

Some small deductions of no more than 2 – 3% are possible to reduce your income to fit into these limits (dependent children, childcare expenses, uninsured medical expenses).

A minimum income is also necessary and is dependent on the sale price of the home you wish to buy, including closing costs and current interest rates.  This minimum will be clarified during your interview.

3. Income Exception for homes with No Funding Restrictions

If your household is either over-income or over-assets, you may still qualify for a limited pool of LCLT homes if your income combined with assets does not enable you to purchase a Market Rate Home on Lopez Island. Market rate is the average sale price of the 10 lowest priced bank mortgage-eligible homes of at least 600 sq. ft. sold in the prior 12 months on Lopez Island. LCLT will provide these calculations based on MLS listings.

4. Credit Rating

Households must have a good credit rating, which means no more than two late payments (30 days late) in the last year, any collections must be paid in full at least six months prior to applying for a mortgage, no judgments or federal debt and no bankruptcies within the past three years.  If you have no credit but no derogatory credit LCLT may be able to build a case of alternative credit for your application.  If you have concerns about your credit, talk to LCLT’s Representative.

To order your free annual credit report, visit www.annualcreditreport.com, or call 1-877-322-8228. Credit reports must be dated within three months of your application date.

5. Household Sweat Equity Contribution (New Construction Only)

To qualify applicants must be willing to contribute sweat equity by participating in the building process including but not limited to working on the construction site. Depending on the funding source, applicants must commit to working a set number of hours per week during the course of construction (typically 16-24 hours per week). On average, a home takes roughly 8 months to build (circumstances depending). Relatives, friends, and “building partners” may contribute up to half of the set hours agreed upon.

6. Assets

Total value of assets, after the co-op share price is deducted, cannot exceed 50%, 80% or 115% of AMI for household size. (depending on program subsidies). For these purposes assets do not include:

1. employer-provided retirement plan (both qualified and non-qualified) and IRS recognized individual retirement accounts;
2. cars or other vehicles necessary for work or daily living;
3. assets required for the conduct of the applicant’s business, or used in applicant’s employment, such as tools, equipment, supplies, and business inventory; and
4. assets that produce an income not greater than 115% AMI based on household size for those aged 65 and over. Examples include brokerage accounts, stocks, bonds, and passive interest in income-producing partnerships, limited liability companies and corporations.

7. Home, Mobile Home, Land

Ownership of any of these will likely make you ineligible. You must list them in your application with the current associated value.  A final determination will be made after a complete review of all terms and conditions are known.

8. Debt

Total projected household debt, including the co-op related housing fees – may not exceed 44% of your income.  Debt includes any long-term obligations (a repayment period of more than six months) such as vehicle and student loans, plus the minimum monthly payment for all credit card debts.  LCLT’s Representative can help you determine this percentage during your initial screening interview.