Good Neighbor Next Door program – are you a good neighbor?
The Good Neighbor Next Door (GNND) program is sponsored by the US Department of Housing and Urban Development (HUD ). With this program, full-time law enforcement officers, pre Kindergarten through 12th grade teachers and firefighters, emergency medical technicians can contribute to community revitalization and stabilization while becoming homeowners through HUD’s Good Neighbor Next Door Sales Program. HUD offers a substantial incentive in the form of a discount of 50% from the list price of the home. In return you must commit to live in the property for 36 months as your sole residence. Only certain homes qualify for the GNND program. Those homes are owned by HUD (REOs). The number of properties available is limited, but new properties become available weekly.
In making an offer on a qualifying property, a home buyer must agree to the list price. For example, if a home is listed for $140,000, a qualified applicant would make an offer for $140,000, but the actual purchase price would be $70,000 (loan amount). All properties through the GNND program are sold “as is” (HUD will not make repairs). This great offer can be combined with HUD’s sale incentive which allows a home buyers to purchase a home with only $100 down if the home buyer finances the property using a FHA loan.
Buyers who wish to participate in the GNND program submit their bid with a registered broker. The amount of the discount (50% of the sale price) becomes a silent second on the property. The home buyer does not need to make any payments on this note nor is any interest accrued as long as the 36 month occupancy requirement is met. The second lien is reduced to zero at the end of the three-year period. Earlier move out may incur substantial penalties. The home buyer must not have owned any other real estate for one year prior to participating in the GNND program.