Good Neighbor Next Door HUD homes are located in every state.
The U.S. Department of Housing and Urban Development's Good Neighbor Next Door program allows firefighters, law enforcement officers, teachers and emergency medical technicians to purchase HUD-owned homes at a 50 percent discount off the list price. Qualified purchasers are required to live in the home as their sole residence for 36 months after the date of purchase. Homes eligible for this program are located in communities targeted by HUD officials for revitalization.
Instructions
1. Visit a bank or mortgage company to apply for a Veteran's Administration, Federal Housing Administration or conventional mortgage loan. Bring your driver's license, Social Security card and pay stubs that reflect at least one month of earnings. This information is used during the mortgage loan application process to determine your eligibility for a mortgage loan.
2. Complete the loan application and any additional forms required by the bank or mortgage company. The completed forms and copies of your personal documents will be forwarded to a loan underwriter for approval. The underwriter will determine the maximum loan amount for which you qualify. It is not necessary to mention the Good Neighbor Next Door Program to the bank or mortgage company.
3. Visit HUD's "Neighbor Next Door" property search page and search for listings in your area. Each listing has an "Agent Info" tab that lists the name and contact information for the listing agent. Contact the listing agent to arrange a showing of the home. Advise the agent that you meet the criteria for the Good Neighbor Next Door program.
4. Select a home to purchase and advise the real estate agent that you would like to submit an offer. The agent will prepare an offer document to submit to HUD for a Good Neighbor Next Door purchase. This document includes the offer amount and declares your intention to purchase the home. You are required to sign this document.
5. Follow up with the real estate agent regarding the status of your offer. Once your offer is accepted, a date is scheduled for a meeting known as a closing to complete the paperwork. Closings are usually held at the office of the attorney who prepared the paperwork before the meeting.
6. Attend the closing and review the closing documents, which include the amount of your mortgage payments, your interest rate, your closing costs and other details regarding the home and the HUD loan. Ask questions about any information that is not clear. Sign and initial the documents in the designated areas.
7. Complete the paperwork for a second mortgage known as a silent second mortgage. This mortgage covers the discounted amount of 50 percent of the purchase price. After meeting all occupancy guidelines for 36 months, the silent second mortgage is forgiven by HUD.
