The U. S. Department of Housing and Urban Development (HUD) wants
to make American communities stronger. The Teacher Next Door (TND)
program is designed to further this goal by encouraging teachers*
to buy homes in low and moderate-income neighborhoods.
Who can participate?
The TND program is open to any person "employed full-time by
a public school, private school, or federal, state, county, or municipal
educational agency as a state-certified classroom teacher or administrator
in grades K-12." Participants must certify that they are employed
by an educational agency that serves the school district/jurisdiction
in which the home they are purchasing is located.
Teachers wishing to purchase a home under the TND program must
be in good standing with their employer. Your employer must certify
that you are a full-time teacher or school administrator. You don't
have to be a first-time homebuyer to participate. However, you cannot
own any other home at the time you close on your TND home. You must
agree to live in the HUD home as your only residence for 3-years
after you move into it.
Additional details and rules for the Teacher Next Door program
may be found in Housing
Notice 99-30.
How do I participate?
TND property is listed
and sold exclusively over the internet. Properties are single-family
homes located in Revitalization
Areas. Properties available through the program are marked with
a special Teacher Next Door button. Bids are awarded once each week.
Your bid must be the amount of the list price. You may submit your
bid directly or utilize the services of a real estate broker. A
computer randomly selects the winning bid. The winning bid is posted
each week on the web site where you made your bid.
You may also buy a home from a government agency or a nonprofit
organization that bought the home from HUD. When an agency or nonprofit
buys the house, HUD expects the full discount to be passed on to
you.
In all cases, HUD requires that you sign a second
mortgage and note for the discount amount. No interest or payments
are required on this "silent second" provided you fulfill the three-year
occupancy requirement.
What are the benefits for the teacher?
The selected bidder may purchase the property at a 50 percent discount
from the list price. For example, if a HUD home is listed for $100,000,
a teacher can buy it for $50,000. To make a HUD home even more affordable,
you can apply for an FHA-insured mortgage with a downpayment of
only $100 and you may finance all closing costs.
If the home you want to purchase needs repairs, you may use FHA's
203(k) mortgage program. This program allows you to finance both
the purchase of the home and the cost of needed repairs. You have
the benefit of one loan for both costs and one monthly payment.
Discuss these financing options with your lender.
Because homes sold through the TND program are located in Revitalization
Areas there may be additional assistance from state or local
government sources. Local or state governments want to encourage
families and businesses to move into Revitalization Area neighborhoods.
Contact your state government housing office or local municipal
government and request information on assistance for homebuyers.
I
already purchased a home under the TND Program. Where can I get
information about my second mortgage?