Mortgages for teachers and educators

Homebuying as a teacher

Teaching is one of those professions where the pay doesn't match the importance of the work. If you're a teacher looking to buy a home, you might be wondering what special programs exist for educators.

The honest answer: there are some helpful options, but "teacher mortgage programs" aren't as widespread as marketing might suggest. Let's talk about what's actually available and what will help you most.

Good Neighbor Next Door (HUD)

This is the real deal for eligible educators. HUD's Good Neighbor Next Door program offers a 50% discount on homes in designated revitalization areas. Yes, fifty percent.

The catch? Limited inventory. Homes must be HUD-owned foreclosures in specific areas. You must commit to living there for at least 3 years. And competition can be fierce - it's a lottery system when multiple people want the same property.

Worth checking, but don't count on finding something through this program.

State and local down payment assistance

This is where teachers often find real help. Many states and municipalities offer down payment assistance specifically for educators, or include teachers in broader "community heroes" programs.

These programs vary widely:

• Grants - Money you don't have to repay
• Forgivable loans - Forgiven if you stay in the area/profession for a set period
• Deferred loans - No payments until you sell or refinance
• Low-interest second mortgages - Helps cover down payment at favorable terms

Pennsylvania, New Jersey, and other states we serve have various programs. The availability and terms change frequently, so we stay current on what's offered in your area.

Teacher loan forgiveness and your mortgage

If you're working toward Public Service Loan Forgiveness (PSLF) or Teacher Loan Forgiveness, your student loan situation affects your mortgage options.

Income-driven repayment plans can actually help with mortgage qualification - your monthly payment might be lower than standard repayment, improving your debt-to-income ratio.

But if you're close to forgiveness, we need to factor that into planning. Taking on a larger mortgage right before a big chunk of debt disappears might not be the best strategy.

What actually helps teachers buy homes

Based on our experience working with educators, here's what makes the biggest difference:

Low down payment options - FHA loans (3.5% down) and conventional loans (3% down) are often the path forward. HomeReady and Home Possible programs also work well for teachers since they're designed for moderate-income buyers.

Gift funds - Teachers often have family willing to help with a down payment. We can structure loans to maximize gift fund usage.

Steady employment history - Teaching provides the stable employment history lenders love. Summers off don't count against you - it's part of your normal pay structure.

Down payment assistance - Stacking available grants and assistance programs can significantly reduce what you need to bring to closing.

The summer income question

Lenders understand teacher pay schedules. If you're paid over 10 months, we annualize your income. If you're paid over 12 months, we use that. Either way, summers off don't hurt your qualification.

If you do summer work (tutoring, summer school, etc.), we can sometimes include that too, depending on how long you've been doing it.

Questions to ask us

When we talk, we'll want to understand:

• What district/school do you work for?
• What's your current salary and any additional income?
• Do you have student loans? What repayment plan?
• What area are you looking to buy in?
• How much have you saved for a down payment?

With this information, we can research applicable assistance programs and find the best loan structure for your situation.

Let's find what works for you

Teaching is hard enough without the homebuying process being complicated. We'll help you understand your options, find available assistance, and put together a plan that works on a teacher's budget.

Get a quote or schedule a call to get started.