Buying a House With the Good Neighbor Next Door Program
June 27, 2018
Buying or owning a house in the US can be a nightmare for most people, especially those belonging to the working class. Even most of the grants and programs available are not really of help when it comes to buying a house. However, you might want to feel yourself as privileged if you are a teacher, emergency medical technician, firefighter or a law enforcer as Good Neighbor Next Door (GNND) may be the best available program for you to buy your house. We shall discuss relevant details in the upcoming paragraphs, but the bottom line is that you can purchase a house at just 50% of the market value if you are lucky enough to qualify for the GNND program.
What is the GNND program?
This program has been created by the United States Department of Housing and Urban Development in order to improve communities and allow teachers, law enforcement officers, firefighters and emergency medical technician an opportunity to own houses at a greatly subsidized rate. The conditions to become eligible for this program are not very strict and many people belonging to these professions usually become entitled to this program. But first, let’s find out about where these houses come from.
Each loan involving an FHA mortgage is insured by the Federal Housing Administration. This is just in case the borrower fails to pay back the loan. In fact the borrower actually defaults. The remaining amount of the loan is paid by the FHA in exchange for possession of the house. Such a home is classified as HUD Home. It then becomes available for sale on HUDhomestore.
Who is Eligible?
The most important condition to be eligible for these houses is that the applicant must belong to one of the above-mentioned professions. Anyone, either first-time or otherwise home buyers, is eligible for GNND but the purchase must be for the primary residence. Moreover, the buyer must live in the property for at least 36 months. Similarly, at the time of purchase, the buyer must not own any other property.
Suppose you are eligible and fulfill all necessary requirements. You will get 50% subsidy on the list price of the house. For example, if the market value of the house in $300,000, you will have to pay $150,000 only. However, you must remember that such houses are available only in certain revitalized areas. So, it is advised to contact your realtor to get assistance related to the most suitable area for you.
The good news is that a significant down payment is not involved. As you only have to pay $100 as down payment. As for the mortgage, you are free to choose any type of mortgage loan. In some cases, 100% financing is also available for homes that fall into this program. Last but not the least; you are not liable to pay any penalty or extra money in case of retirement or leaving your job. As long as you fulfill all other requirements of the Good Neighbor Next Door program.