UESF News |
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Homeownership for Teachers & Paras
The following is adapted from an article in the SF Educator, which ran in December, 2007. In recognition of the difficulties teachers have in finding housing in San Francisco, Mayor Gavin Newsom announced in September a new $20,000 housing subsidy for public school teachers, known as the Teachers Next Door Program. The subsidy is one of several programs available to SFUSD teachers and paras, that aims to keep educators living in the communities in which they teach. The programs are part of a larger movement in San Francisco that is coalescing around the theme of attracting and retaining the very best educators. “We’re excited to be offering this new program, but it really is just the beginning of the services out there,” says Myrna Melgar of the Mayor’s Office of Housing. “The important thing is for folks to know that they can layer different subsidies and loans.” This down payment assistance program will make loans of $20,000 available to teachers to purchase their first home in San Francisco. The loan will require no payments, and will accrue no interest. If the teacher remains employed with the district for five years, the City will forgive the loan at a rate of 20% per year, so that at year ten the entire loan is forgiven. More San Francisco ProgramsBeyond the Teacher Next Door Program, the Mayor’s Office of Housing administers several first time homebuyer programs available to teachers and paras in the San Francisco Unified School District. Depending on long-term financial goals, these programs can help you become a homeowner and build financial security through homeownership. These can be used in combination with one another, and include: Below Market Rate Units (BMRs) – These units are price restricted to be affordable to households at 100% of the area median income. They are in all neighborhoods and sizes. They are available through a lottery when they are first built, or upon resale. Their resale price is also restricted to keep them affordable. Down Payment Assistance Loan Program (DALP) – This program makes down payment loans with no monthly payments or interest to households up to 100% of area median income. They are for the purchase of any single family unit in San Francisco, except for BMRs. Repayment of this loan is upon sale of the house or refinance to cash out, and repayment requires paying back a share of the appreciate (profit) along with the original loan. Mortgage Credit Certificate Program – This is an extra tax credit (15%), that increases your purchasing power. City Second Program – These units are priced at the market rate in selected buildings around San Francisco, but they have a silent second mortgage with no interest and no monthly payments to subsidize the purchase. They are available to households earning up to 120% of the area median income. When sold, the borrower must pay back the original loan plus a share of the appreciation (profit). There are several other state and federal programs that can help as well. Among them is the Extra Credit Teacher Program (ECTP) which is designed to help high priority schools attract and retain teachers and paras by offering down payment assistance for the purchase of a home anywhere in California. Educators at thirty-seven schools in San Francisco qualify. The California State Housing Financing Agency also offers lower than market rate first mortgages to low and moderate income first time homebuyers through participating lenders. Additionally, teachers in low-performing schools get access to lower interest rates. Home-Ownership Counseling AgenciesThe Mayor’s Office of Housing also funds several agencies that provide counseling to first time homebuyers about all available programs. According to Myrna Melgar, your best bet is to start with any of these City-approved home-ownership counseling agencies. They have been pre-approved as service providers and will discuss topics including – qualifications for loans, subsidies, and programs; how to improve your credit report; shopping for a home; and the purchasing process. A certificate of completion from a home-buyer counseling course is required for most San Francisco programs, and are highly encouraged for all. Classes are provided regularly by each of the counseling agencies. For More informationIt is a good idea to start your research with the Mayor’s Office of Housing. Go to www.sfgov.org/site/moh_index.asp to learn more about all of the programs. You can also call Myrna Melgar at 701-5531.
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