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new poll from Newsweek reveals that Generation Z, born between 1997 and 2012, carries a staggering amount of personal debt. On average, adult Gen Zers owe $94,101, surpassing Millennials ($59,181) and significantly exceeding Gen Xers ($53,255). Credit card debt is the most common liability among Gen Z, with 56% carrying some form.

    Despite their high overall debt, only 16% of Gen Z respondents have a mortgage. As this generation enters prime homebuying age, their debt burden raises concerns about their future homeownership prospects. What's more alarming than the sheer amount of debt is Gen Z's high delinquency rate, with credit card delinquency rates highest among this generation compared to others.

    Having a large debt burden is a barrier to homebuying, but a history of serious delinquency can be an outright deal breaker. Late payments lower credit scores and can linger on credit reports for years, making mortgage approval much harder for prospective buyers.

    To determine how much debt is too much to buy a house, lenders use the debt-to-income (DTI) ratio, which measures how much of your monthly income goes toward debt payments. A DTI of 36% or lower is generally preferred, with 28% to 35% allocated to housing costs. With Gen Z likely dedicating a significant portion of their monthly income to debt repayment, qualifying for a favorable DTI will remain a challenge.

    Buying a house with debt is possible, but borrowers should focus on improving their financial health to increase their odds of approval and secure better rates and terms. To lower your DTI, you can pay off existing debt, increase your income, or borrow less by opting for an affordable home or making a larger down payment.

    Aiming for an excellent credit score is also crucial. Lenders want to see that you're a reliable borrower with a solid history of on-time payments. A higher credit score not only increases your chances of mortgage approval but can also secure you a lower interest rate, saving you thousands over the life of your loan.

    If your credit score is lower than lenders' preferred thresholds, you may still have options in government-backed loans, such as FHA Loans, VA Loans, and USDA Loans. These loans offer more flexible requirements for credit scores and down payments.

    Having killer savings is also essential, as lenders will look to see if you have enough cash reserves to cover your down payment and closing costs. Getting pre-approved for a mortgage can also strengthen your position when making an offer on a home.

    Ultimately, Gen Z should be realistic about whether now is the right time to buy or if they'd be better off delaying homebuying to focus on improving their financial health.