Teacher Next Door
Teacher Next Door (TND) is a private nongovernmental service that helps pre-K to 12th-grade teachers, as well as college and university professors, find homes to buy and suitable federal, state, and local homebuying assistance programs. TND agents streamline the purchase process, taking care of negotiation, financing, and closing. Additionally, the program can help you find down payment assistance up to $10,681 and grants up to $6,000 that can be used to cover closing costs. Other benefits include:
No application, broker, or upfront feesFree appraisalsFree homebuyer representationsDiscounted title feesFree access to MLS home listings
If you don’t yet qualify for a home loan, TND offers a credit repair program that can help you identify and overcome credit challenges so you can get approved.
Good Neighbor Next Door
The HUD Good Neighbor Next Door Program offers pre-K through 12th-grade teachers a 50% discount on eligible homes in revitalization areas. You can find eligible homes on the FHA’s Revitalization Area Sales Programs page. While 50% off sounds like an amazing offer, a potential downside to this program is that you can’t choose any house you’d like. You will need to choose one that is located in an area the government is trying to revitalize. Further, you’ll be required to sign a second mortgage in the amount of the discount. However, no payments or interest will be due as long as you live in the home as your primary residence for three years.
Homes for Heroes
Homes for Heroes is a national program with a large network of business, mortgage, and real estate specialists. It helps military members and other frontline workers, including teachers, save when buying, selling, or refinancing a home. To join, you can register online, and a local representative will contact you. They can answer all your real estate and mortgage questions at no cost and with no obligations. If you decide to buy your home with the help of Homes for Heroes, an agent can help you save throughout the process.
Other Teacher Home Loan Options
You can find additional home loan options for teachers through other sources, including teachers unions and private lenders.
Teachers Unions
If you are part of a teachers union, whether national, state, or local, check your member benefits. Many unions partner with lenders like Union Plus to offer perks like purchase grants, cash back at closing, and hardship assistance.
State Programs
Your state government may also have programs in place to help teachers in the homebuying process. For example, California’s Housing Finance Agency (CalHFA) offers the MyHome Assistance Program, which extends deferred-payment junior loans on FHA, USDA, and VA loans. These loans cover closing costs and/or down payments and range from 3% to 3.5% of the sale price.
Local Programs
You may find programs available to residents of your city or county, whether public or private. Landed, for example, offers down payment assistance to teachers living in certain high-cost cities, such as Seattle, Los Angeles, and San Francisco.
Private Lenders
Some private mortgage lenders have programs specifically designed for teachers. For example, Supreme Lending offers the Educator Mortgage Program, with discounted closing costs (up to $800), discounted real estate agent fees (up to $800), and donations to your preferred school (up to $400).
Alternative Programs
While not specifically designed for teachers, the FHA, USDA, and VA loan programs are worth considering. They offer competitive rates, flexible eligibility requirements, and low down payments.
FHA Home Loans
The Federal Housing Administration (FHA) insures mortgages, which are then provided by approved lenders. The benefits of an FHA-backed loan include:
Down payments as low as 3.5%Easier credit qualifications than conventional loansAffordable closing costs
One of the drawbacks of FHA loans is that they have maximum loan limits, which vary by county. This may be a problem if you’re looking to buy a home priced above the limit. Further, while FHA loans tend to be the cheapest option for buyers with lower credit scores and smaller down payments, they can be more expensive than conventional loans if you have good credit and can make a down payment of 10% to 15%.
USDA Home Loans
Are you interested in living outside city limits? Through the Section 502 Guaranteed Loan Program, the USDA guarantees loans for qualifying borrowers who are buying, purchasing, building, rehabbing, or relocating homes in eligible rural areas. The biggest benefit of this program is that it offers 100% financing, so no down payment is required. To qualify, your income can’t exceed 115% of the median household income in your area and you must live in the home as your primary residence. While this won’t work for those who want to live in the city, it can be a great solution if you’re interested in an eligible rural home.
VA Home Loans
Are you a veteran, active military service member, or surviving spouse? If so, the U.S. Department of Veterans Affairs (VA) offers a home loan program that may be able to help you. VA Home Loans are also backed by the federal government and are offered through private lenders. VA home loan benefits include:
No down paymentFavorable terms and interest ratesNo private mortgage insurance requirementsReduced closing costs
The drawbacks of VA home loans include a one-time VA funding fee that you may need to pay, as well as a complex process. However, the overall savings could make it all worth it. A good place to start if you want to learn more is to review the VA loan eligibility requirements.
How To Find Teacher Loan Assistance
With all of the available assistance programs and home mortgages for teachers, becoming a homeowner may now be possible. To get started, review the programs above and research others that may be available to you on a state and local level. Make a short list of the options that make the most sense for your situation. Then, research and compare the costs and benefits of each option. The best programs will streamline the homebuying process from beginning to end while helping you save as much money as possible.
