The following article from today's Denver Post is a great resource for teachers, police officers and EMT's.  Please call or email me for more information about this great program!  303.963.5335 or Rachel@CoolDenverHomes.com

 

Denver Public Schools teacher Erich Smeaton likes to say he got lucky three times on his way to becoming a homeowner in Denver's Ruby Hill neighborhood.

First, another teacher at South High told him about the Good Neighbor Next Door program.

The federal program, frequently referred to as GNND, provides a 50 percent discount for the purchase of certain homes by teachers, firefighters, police officers and emergency medical technicians.

"I jumped on it," Smeaton recalled.

In October 2008, Smeaton called real-estate broker Xenia Matteson. Together, they walked through the home he now owns — a foreclosed property held by the U.S. Department of Housing and Urban Development.

In January, he submitted a $49,000 bid on the 700-square-foot bungalow in southeast Denver. It was listed by HUD at $98,000.

The GNND program makes HUD homes available at half-price to eligible buyers in designated revitalization areas. Greater Denver has about 20 such areas. The program aims to bring public-service professionals into economically struggling communities where their presence will help stabilize the neighborhood.

"I've seen it happen," Matteson said.

An area on South Quivas Street, six blocks east of Smeaton's place, improved significantly after an influx of young teachers, including many of her own clients, she said.

In Colorado, 552 homes have been purchased through the GNND program, according to HUD. The program combines two previous programs — the Teacher Next Door and the Officer Next Door, both created in the Clinton era.

Firefighters and EMTs gained eligibility in 2006, and the program's new name took hold.

"People think of this area as the 'hood. I don't consider it the 'hood," Smeaton said of his Ruby Hill neighborhood. His neighbors are mostly working families, he said, including many whose children attend South High, where he teaches geography and English as a second language.

Smeaton's home needed $35,000 in repairs, including a new roof and siding, as wells as plumbing and electrical work. When repairs are needed, the buyer of a GNND home must hire a HUD-approved contractor to do the work. Funds are available in the form of federally backed "203k" home-renovation loans. The borrowed renovation funds are rolled into the buyer's mortgage.

After a homebuying bid is submitted, it is entered in a lottery, competing with bids from other teachers, firefighters, police officers and EMTs.

"We never have any idea how many people we're bidding against," said Matteson, who has brokered and closed 22 purchases for teachers this year.

Smeaton won the lottery in his first attempt. "I got lucky for a second time," he said.

Some acquaintances of Smeaton and Matteson have failed as many as 12 times in their bids for GNND properties.

"Eligible homes are pretty scarce," said Matteson. Even in revitalization areas, relatively few homes are selected by HUD for the program.

HUD signs a promissory note for its half of the purchase. It is a "silent second" mortgage on which the buyer never makes a payment. After three years of occupancy, the second lien goes away. Buyers who choose to sell the home early must pay off a share of the second in proportion to the unfilled part of their three-year commitment.

"It is a great program," said Matteson. Participants need not be first- time homebuyers.

Smeaton said his third stroke of luck came from the government's $8,000 tax credit for first-time homebuyers. His purchase closed in March, allowing him to take advantage of the program, which has since been extended through April and expanded to include a $6,500 tax credit for buyers who have owned their existing homes for more than five years.

More information

For more information about the Good Neighbor Next Door program, go to www.hud.gov/ offices/hsg/sfh/reo/goodn/ main.cfm.