How to Get Home Loans For Teachers

Teacher home loans are out there, but you have to figure out which one is right for you, and see what's available in your state. You can get a deep mortgage discount if you just find the right program, and as a teacher, funds are often limited. Take advantage of these home loans for teachers because educators deserve a break.

Instructions

1. To get a teacher home loan, apply for the FHA Teacher Next Door Program. Yes, you have to live in a revitalization area, which basically means a low to moderate income neighborhood, but the savings on these home loans for teachers are vast. You get a 50% discount off of the appraised value of the home, and only have to put $100 down.

2. Once you are approved for this teacher mortgage, expect to live in the home as your primary residence for 3 years. You are not allowed to purchase a home as an income property under this teacher home loan program, and the consequences are severe if you are caught doing so. You may be required to repay the 50% discount. It's a big committment, but can be worth it for the savings.

3. Under this mortgage program, the available properties are foreclosure homes, so expect a fixer upper. These were originally insured through FHA, which is why they are now available to teachers. A foreclosed home might sound like a bad idea because the image it conjures up is a completely trashed property, but they are not always in terrible shape. You might have to visit multiple properties, but it's not impossible to find a good one and make this teacher home loan work for you.

4. Act fast when you find a property you like. The Teacher Next Door Program only gives you 48 hours to get the loan process started once your offer is accepted. It's best if you can get pre-approved for the loan before you find a property. That will make the home loan process much smoother.

5. If the Teacher Next Door Program is not for you, there are also teacher home loans made available by individual states. For example, in California, there is the Teacher Extra Credit Loan. It has many restrictions, but it can be perfect for the first time home buyer. Restrictions include teacher must work in a low performing school, family income limits, home sales price limits, teacher must pay 3% of purchase price as a borrower contribution, etc. If you can get through all of the requirements, you can get this valuable home loan for teachers. Other states have similar programs.

Tips & Warnings

• The available HUD properties are only listed on the Internet. They are not in the general MLS.

• Administrators are also eligible, in addition to state-certificated teachers.

• If you try to sell the home before your 3 year committment is up, you may have to repay some or all of the discount. Be sure you find the right home!

• HUD can also limit your sale price if you try to sell the property early.