Who Qualifies for a Good Neighbor Next Door Loan in California?
A Good Neighbor Next Door Loan is a good option to consider if you work as a teacher, police officer, firefighter, or emergency technician and want to know about home loans for first responders.
Let’s look at how this federal loan program works and determine if you qualify for the loan.
How does the Good Neighbor Next Door Loan Work?
The FHA Good Neighbor Next Door Loan provides huge discounts on home financing for people who commit their lives to protect our communities.
EMTs, School Teachers, Police Officers, Firefighters, and other public servants may qualify for this special loan program. You can enjoy all the benefits of an FHA loan, such as a low minimum down payment and less stringent credit score requirements.
Public servants can avail of eligible homes with a 50% discount on the list price as long as the buyer must use the property as their primary residence for a minimum of 3 years.
When you buy a GNND home with FHA financing, the minimum down payment is only $100, which is an excellent benefit for all public servants who qualify.
If you want to learn more about an FHA loan in California, you can reach out to our loan officers at Nuline Funding.
Do I qualify for the program?
To qualify for the GNND program, you must work in a public service profession and service the area where your GNND home is located. For example, teachers must buy a home within the school district where they teach.
You also have to be a full-time worker and plan to remain in your profession for at least a year after closing on the home. Take note also that you can only purchase a GNND home once.
Here are public servant professions that qualify for the GNND program:
Teachers who work for a state-accredited private or public school that teaches students in grades pre-K through 12.
Firefighters who are employed by state, federal, local, or tribal fire departments
Law enforcement officers who are employed by state, federal, local, or tribal law enforcement agencies.
EMTs who are employed by state, federal, local, or tribal emergency medical service units.
A Glendale mortgage broker can help you get pre-approved for an FHA loan to make things easier for you.
What homes are eligible for the program?
Eligible properties under the GNND program are single-family homes found in revitalization areas and listed exclusively for sale under the Good Neighbor Next Door program.
If you want to buy a home at 50% less, you better move fast since listed properties are made available for seven days, then they are offered to the public at full price.
With this in mind, we recommend getting pre-approval for FHA financing before you join the program.
Once eligible, you can access the GNND program through the HUD and see current home listings. Let’s say a GNND home is listed at $150,000, you can buy it at $75,000, but you are required to sign a second mortgage for the discount amount. You don’t have to pay interest or monthly installments on the second mortgage as long as you use the home as your sole residence for 3 years.
If you want to know more about first responder home loans, contact one of our loan experts today.
Benefits of the Good Neighbor Next Door Loan Program
Here’s a list of the great benefits you’ll get when you join the GNND program:
HUD houses are already priced at discounted rates but if you buy one through the GNNG program you can get an added 50% discount as long as you live in the home for 3 years.
Once you’ve complied with the 3-year minimum residency requirement the silent second mortgage is life which means home equity goes to the owner. This puts you in a good position to refinance your home if there are better rates available.
You can avoid paying for closing costs when you close on the home. GNND buyers can finance closing costs through the FHA loan.
You can sell the property or have it rented out once you fulfill the 3-year minimum residency requirement.
Are you ready to try out a Good Neighbor Next Door Loan?
If you want to enjoy the benefits of a Good Neighbor Next Door Loan, you can apply for a Nuline Funding FHA mortgage.
Our loan officers will guide you through the whole process and help you become a homeowner in no time.
* Specific loan program availability and requirements may vary. Please get in touch with the mortgage advisor for more information.