Teacher Next Door: Home Loans & Grants for Educators

Written by Kim PinnelliUpdated: 24th May 2022
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If you’re a teacher having a hard time buying a home because of a low salary, the Teacher Next Door Program may help you buy your dream home.

The TND program helps lower the cost for teachers, making buying a homemuch easier to achieve. There aren’t any special requirements you must meet except that you must be a teacher (or support staff).

Keep reading to learn just how easy it can be to get help buying a home as a teacher.

Are there Home Loans and Grants Available for Teachers?

Teachers have many options for home loans and specific grants. The most common assistance program for teachers is the Teacher Next Door Program. This program combines grants and down payment assistance to help teachers buy any home in the community.

What is the Teacher Next Door Program?

The Teacher Next Door Program is a grant and down payment assistance program that helps teachers with grants of up to $6,472 to help with closing costs and up to $10,681 in down payment assistance. This leaves more money in teachers’ pockets to fix homes or have money for the other costs of homeownership.

Teachers don’t pay any upfront fees or application fees and have access to the most competitive interest rates. In addition, teachers get a free appraisal and access to foreclosure listings if they want to buy a fixer-upper and save even more money while helping the community.

The entire process gives teachers access to discounted services all the way to the closing, helping make the home buying process more affordable.

What Are the Benefits of the Teacher Next Door Program?

It’s no secret that buying a home is expensive today, but the Teacher Next Door Program makes it much easier.

With lower costs, preferred interest rates, and access to services regular buyers’ don’t get; teachers have the advantage of affording the home they want. Many teachers use the opportunity to buy a rundown home because they’ll have enough funds to fix it up with the savings the Teacher Next Door Program provides.

Who Qualifies for the Teacher Next Door Program? And What Are the Requirements?

To be eligible, you must be a Pre-K – grade 12 teacher at a public or private school. It also applies to college and university professors. If you work at a school but aren’t a teacher, the benefits may also extend to you if you are a part of the support staff at the school.

You must go through the Teacher Next Door agency to use the program. It’s not a government programthat any lender can offer. You can only get assistance through TND, which works with only two partner lenders.

Is Teacher Next Door Available in Every State?

Yes, the Teacher Next Door Program is available in all 50 states. Click hereto see the requirements and details for your state.

Other Home Loan Programs for Teachers and Educators

Teachers are also eligible for a few other home loan programs, including:

Good Neighbor Next Door

If you buy a home in a HUD revitalization area within the district you teach, you may take advantage of the Good Neighbor Next Door program, which allows teachers to buy a home for 50% of its list price. The remaining 50% becomes a silent mortgage on the home. If you live in the home exclusively for three years, the silent second mortgage is forgiven. If you don’t fulfill the requirement, you must make up a prorated amount of the difference between the sales price and the discounted amount based on how long you lived there. This program only works if you buy a home in a revitalization area (an area that needs help).

Homes for Heroes

The Homes for Heroes programhelps certified teachers lower the cost of buying a home. They may be able to lower your closing costs, title costs, and appraisal or inspection fees. This leaves more money in your pocket to afford the down payment and all costs that go along with buying a home. You don’t have to buy a home in a specific area to qualify for this program. You can also combine this program with most other programs for teachers.

Teachers Unions

Check with your local teachers’ unions to see if they offer any special programs. Each area has different benefits for teachers. The American Federation of Teachers and the United Federation of Teachers have some programs to help save teachers money on buying a home.

FHA Loans

While not specifically for teachers, FHA loans are a good option because you don’t need great credit or a low debt-to-income ratio. If you’re starting in your career, you may have a lot of student debt or not have a high credit score yet. The FHA loan offers flexible guidelines and only 3.5% down on a home so that you can get into homeownership much faster.

USDA Loans

If you make less than 115% of the median income for your area and don’t mind living in areas the USDA designates as ‘rural,’ then you can use USDA financing for your home. This no down payment program has flexible guidelines and limited closing costs. It would help if you had a 640-credit score and a maximum 41% debt-to-income ratio to qualify. The biggest concern is that you don’t have a home to live in and don’t qualify for any other financing. That’s what gets you in the door with USDA financing.

VA Loans

If you’re a veteran of the military, VA loans may be an option as long as you had anything but a dishonorable discharge. This is another no down payment loan program, and the VA doesn’t require a minimum credit score. As long as you can prove you have enough disposable income for the area you live in and your family size, you may qualify for this flexible and affordable loan program.

Is the Teacher Next Door Program Worth It?

The Teacher Next Door Program is valuable, especially if there aren’t other options to help you buy a home.

While it might be a hassle to go through the TND program, it can save you thousands of dollars on closing costs and provide down payment assistance. The good news is that if you don’t qualify or don’t have the time to go through the program, there are other affordable options for teachers, making buying a home much easier.

Bottom Line: Teacher Next Door Program

Don’t let your low salary or high amount of student debt stop you from buying a home. The Teacher Next Door Program makes it easy to afford a home. With lower down payment and closing cost requirements, it’s easier to afford a home, and you can buy one anywhere you want. The only downside is you must go through the TND program using their lenders, so you can’t shop around and use your preferred lender.

If that doesn’t work for you, there are many other ways to lower the cost of buying a home as a teacher! Find your dream home, and the financing will be available to you.

Kim Pinnelli
Kim Pinnelli

Kim Pinnelli is a Senior Writer, Editor, & Product Analyst with a Bachelor’s Degree in Finance from the University of Illinois at Chicago. She has been a professional financial writer for over 15 years, and has appeared in a myriad of industry leading financial media outlets. Leveraging her personal experience, Kim is committed to helping people take charge of their personal finances and make simple financial decisions.