Good Neighbor Next Door Program
Good Neighbor Next Door
Discount homes for teachers, firefighters, EMTs, and police officers.
Eligible Participants for Good Neighbor Next Door:
The good neighbor next door program provides an opportunity for teachers, police officers, firefighters, and emergency medical technicians to purchase eligible homes at a 50% discount off the listed price.
The program was designed by HUD with the intent of promoting homeownership along with the purpose of revitalizing neighborhoods across America. The significant discounts on home prices hope to bring in “good neighbors” that will move into select revitalization areas. The term “good neighbor” is based on the assumption that the individuals and families that would be moving in are likely going to be responsible members of the community and possibly even having a positive impact on the area.
Good Neighbor Next Door Program Requirements
- In order to participate for the good neighbor HUD program you must be employed full-time as a teacher, police officer, firefighter, or emergency medical technician.
- You must either be a first time home buyer, or have not owned a home in the past year.
- It is required that you complete a homebuyer education course.
- The property that you buy must be a one unit single family residence. This means you can buy a house, condo, of townhouse. You may not purchase a 2-4 unit property such as a duplex, triplex, or fourplex.
- You must personally occupy the property for 36 months. You may not rent out the property, or live in a different home that is used as your primary residence. In order to qualify you must sign a second mortgage note for the 50% of the purchase price that is being discounted. This is called a “silent second mortgage” which means you do not have to pay it back, as long as you do not move, or sell the property within 36 months.
Our GNND Mortgage Loan Programs Are Available in the Following States:
Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Florida, Georgia, Kansas, Louisiana, Iowa, Illinois, Indiana, Maryland, Michigan, Minnesota, Missouri, Nevada, New Hampshire, New Jersey, New Mexico, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Utah, Virginia, Washington State, Wisconsin, Wyoming.
GNND Frequently Asked Questions:
Are nurses eligible participants?
It is a common misconception that nurses qualify for the good neighbor next door program but unfortunately at this time they are not included in the program. However, we offer many great home loan programs for nurses.
What is the purpose of GNND?
The US Department of Housing and Urban Development established GNND as a way to build strong communities by bringing upstanding community members into certain neighborhoods. The program encourages professionals to seek housing in areas they might not have considered otherwise. The program also brings in new teachers, law enforcement officers and emergency responders to work in the areas that need them most. GNND is also beneficial for first-time home owners who would benefit from a significant discount.
Who is eligible to participate in GNND?
Teachers, firefighters, police officers and emergency medical technicians are eligible to purchase homes using the GNND sales program. Teachers must be involved with pre-kindergarten to 12th grade; college-level instructors are not eligible. We have other home loan programs for educators that accommodate to all types of educators, including those at the colleges and universities, and all school faculty, not just teachers.
How much is the discount for eligible GNND parties?
Those who qualify for GNND may receive a discount of 50% taken off the value of the home, determined by the Department of Housing and Urban Development. You are not allowed to haggle on the price of the home. Every person put in the lottery for a particular home must bid the listing price of the home to be eligible. This means that if a home is listed at $80,000, you will place a bid for the full amount but will end up paying just $40,000. In addition, the buyer may be qualified to pay a severely discounted down payment.
How can I obtain financing for my GNND home?
We are HUD GNND mortage lenders. It is fine for you to pay with an FHA, VA or conventional mortgage, and we provide programs for each. We recommend an FHA loan since you may qualify to only have to place a $100 down payment. Many participants even pay the full amount in cash though. One requirement the Department of Housing and Urban Development does have is that participants sign a second mortgage and note for the discounted amount. Participants are not required to make any payments on this mortgage unless they fail to meet the occupancy requirements.
How can I purchase a GNND-approved home?
You must work with an approved real estate agent or broker to find one of these approved homes. You will be entered into a lottery for the home you select. Each home is listed on the market for just five days before the lottery winner is pulled. While you are only able to purchase one home, you are eligible to put your name in the lottery for as many as you like. This will increase your chances of winning a home. You are always welcome to back out if you learn that the home you win just isn’t for you.
What kinds of homes qualify for GNND?
These homes are located in revitalization areas, of which there are hundreds in the US. In addition, all homes are single-family units and do not include condos, apartments or town homes. Each home has been foreclosed on in the past. This means that a wide variety of homes are available, fitting into any budget.
What if I already own another home?
It is required that you do not own any residential property at the time you submit an offer on a GNND home. In addition, you may not have owned a home in the 12 months leading up to your offer.
Do the GNND homes come with a warranty?
Unfortunately, no. All GNND homes are sold “as is.” None of these homes come with warranties; however, special FHA mortgages will help buyers repair their homes at a reasonable rate.
Are there any loan programs that will finance repairs?
Special FHA mortgages are available for those eligible for GNND and who want to make home repairs. If the home requires repairs amounting to more than $5,000, the buyer may incorporate the cost of repairs into the monthly mortgage payments.
What if I lose or quit the job that made me eligible for the GNND program?
If you no longer work in the job that made you eligible during the 36-month period, you may keep the home so long as you continue living in it. When you sign up for the program you are making a good faith agreement to remain employed in the position. The Department of Housing and Urban Development urges people not to apply for the program if they do not believe they will continue working in their current field of employment.
Do I need to pay earnest money?
You must pay 1% of the listing price in earnest, demonstrating that you intend to purchase the homes. Eligible parties who qualify for FHA-insured mortgage programs must place only $100 down on the home’s initial payment. In addition, the buyer is qualified to finance all closing costs.
Do I have to buy a GNND home in my district?
Yes. Teachers, firefighters and EMTs who take advantage of the program must live in the areas their employer serves. Law enforcement officers are restricted to homes within a reasonable commuting distance.
What if I do not live in the house for the required 36 months?
The HUD will follow up with all GNND-approved buyers on an annual basis. The department will use spot checks to ensure that the residence is kept by the buyer. These checks can occur at any time. In addition, buyers must sign an agreement each year, certifying that they still live in the home. Failure to return this certification promptly may result in an investigation.
Active military members called for deployment are allowed to rent the home out in their absence after filling out the proper paperwork. Those who move before the time period is up are required to pay the discounted amount to the Department of Housing and Urban Development. It is considered fraud to break the required occupancy period without informing the HUD and in these cases the HUD will consider criminal prosecution and a hefty fine.