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Habitat for Humanity Program

Habitat for Humanity

Brief Description: MBOH works with Habitat for Humanity in chapters across the state to provide first mortgages for Habitat homeowners who credit-qualify for a loan. By providing financing for these mortgages, MBOH allows Habitat to receive the cash when the family moves in, providing resources to purchase land and materials for another family.


Borrower Eligibility Criteria:

Income limits according to Habitat criteria

First-time homebuyer can be waived for targeted area depending upon Habitat criteria

Home must be primary residence as long as the loan remains in place

No asset limitations

Must be Habitat-partner homebuyer

Housing Division employees building a Habitat for Humanity House in Helena
Two men working on the house

Property Criteria:

Purchase Price Limit

Limit of 15% use of the property for business 

Land limited to 35% of value of appraised value, 40-acre limit, with no subdivision or sale of land possible.

Loan Criteria:

MBOH loan at 2% with Wrap around Habitat Second loan at 0%, Contact MBOH to calculate loan amounts

Hazard insurance $1000 deductible all peril

No lender fees allowed. Purchase at 100%

60-day loan reservation limit for existing home, 180 for new construction

Taxes and insurance must be held in escrow


 A crew hanging up blue siding

Underwriting Criteria:

Lenders qualify borrowers for loan amount based on 30-year amortized loan at 0% interest.  This loan amount becomes the purchase price and the appraised value for purposes of underwriting.

Underwrite to RD or FHA standards, using the loan amount from above as the appraised value (not the actual apprased value"

Form 1004 appraisal required if not FHA-approved


Down payment Sources:

Habitat takes third position mortgage on the amount of the value of the home beyond what the borrower can qualify to borrow


Mortgage Insurance Information:

MBOH loan is uninsured.


Lender Reservation Process:

Fax reservations to MBOH, including:

Reservation cover sheet and required documentation listed on cover sheet.

Letter from Habitat approving borrower for loan.

Amount of loan at 0% for 30 years from Underwriting qualification and print-out from RD or FHA system.  MBOH staff will calculate the split of this loan amount into two parts, the MBOH loan and the wrap-around loan, and send this information back to the lender with the confirmation.

Lenders can check reservation status on Lender on Line.


Special Closing Documents:

Habitat loans require a specific Mortgagor Affidavit at closing

This is a summary of the MBOH program only. For a complete copy of the terms and conditions see Mortgage Purchase and Servicing Guide and the Terms and Conditions of the set-aside.