Teachers are perhaps some of the most underpaid and undervalued professionals in the US. The typical American educator earns only roughly $30,000 to $50,000 annually. That being said, most teachers find themselves in a difficult place when it comes to deciding to buy a home.
What options are available for them? Are there any existing special programs that specifically cater to the needs of this demographic?
There in fact are. Let’s look at these options.Need financing? We can help.
The Good Neighbor Next Door Program
The Good Neighbor Next Door Program is a homeownership initiative created by the United States Department of Housing and Urban Development or the HUD to encourage the renewal of revitalization areas in the country by “providing law enforcement officers, firefighters, emergency medical technicians and teachers an opportunity to purchase homes in these communities.”
Eligible participants are given a 50 percent off from the list price of HUD foreclosure homes if the home is located in an area designated by the HUD as a revitalization area.
Per the HUD, revitalization areas are “HUD-designated neighborhoods in need of economic and community development and where there is already a strong commitment by the local governments.”
Find an eligible area here.
Teachers are at the front row of these benefits. But how does the HUD define a qualified educator for the program?
Per the program, you need to be a K-12 teacher, and use the property as your primary residence for three years.
Teacher Next Door
Another initiative of the HUD, Teacher Next Door helps teachers and educators find the right mortgage option by connecting them to a wide network of programs and organizations that offer reduced mortgage rates and costs. Some of these also offer down payment rebates. The Good Neighbor Next Door program is included in this network but the scope is not limited only to revitalization areas. There are also residency requirements.
Home for Heroes
This program offers a 25 percent off your realtor fee when you purchase or sell a home with a realtor or broker who is signed up as an affiliate of the program. There is also a reduction in closing charges and home inspection fees.Check out today’s rates.
Other mortgage alternatives
There are many organizations who serve the function, either backed privately or through local governments. You can check with your state for these specialized programs.
To make your hunt easier, use the HUD’s list of homebuying programs categorized by states.
You may receive community lending programs such as one offered by ICC Mortgage. Home loans for teachers also exist at some local areas, while some lenders and organizations offer programs with teacher-specific housing qualifications.
Or, perhaps, you don’t really need a teacher-directed program to get the best deal. If you’re cash-strapped, certain down payment assistance programs can help you get a loan to purchase a home. You can also look into some federally-insured mortgage programs such as the:
FHA loan – a loan program for first time homebuyers that offer competitive interest rates with only 3.5 percent down payment requirement for those who can meet the program’s eligibility requirements
USDA loan – a program for low-to-moderate income borrowers to purchase homes within areas designated by the US Department of Agriculture as rural (but includes many suburban areas)
If you’re low on your options, it might be worth your while to explore these programs as well.Click to See the Latest Mortgage Rates»