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Mayor's Office of Housing
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Teacher Next Door Loan Program (TND) |
We will not accept applications from non-participating lenders, for the list of participating lenders , please go to DALP web page
Program Overview
The Teacher Next Door Loan Program provides Downpayment Assistance loans to credentialed Teachers employed by the San Francisco Unified School District. The loans are forgivable according to the years of service the teacher remains in the school district.
Borrower Eligibility
To be eligible for a TND loan, a borrower must be a credentialed teacher currently employed by the San Francisco Unified School District, and have a combined household income of no more than 200% of the AMI of SFMA.
First-time homebuyer: The TND loan is for the purchase of the teacher’s first property in San Francisco. The property must serve as the teacher’s principal residence (be owner occupied).
Homebuyer Education Requirement: Borrower will be required to complete a first-time homebuyer education course through one of MOH's 5 approved housing counseling agencies(see below). A certificate of completion of homebuyer education must be included with the application package.
First Mortgage: All City loan approvals are made in conjunction with a first loan commitment from a bank or mortgage lender. The loan must be fixed interest rate, 30 year loans and fully amortizing. No interest only, option ARM, balloon or negative amortization payment options loans.
Debt-to-Income Ratio: Applicants monthly housing debt, including property taxes, property insurance, and if applicable mortgage insurance and homeowner’s association dues cannot be less than 38% of the household’s gross income. The ratio of monthly housing costs, plus all other household monthly debt (including credit cards, car payments, etc.) cannot exceed 45% of the household’s gross income.
First time homebuyer counseling is required for all City Downpayment Assistance Loans.
Property Eligibility
Properties purchased with TND funds must be single-family residences units in the City of San Francisco, which include: detached single-family house, condominiums and townhouses.
Loan Amount
The loan amount available for TND loans is $20,000.
Loan Terms
The maximum loan amount under the TND program is $20,000. The loan may be used for either closing costs or downpayment. There is no interest, nor shared appreciation. TND loans may be layered with DALP, City Second loans, and used for the purchase of BMRs and Condo Conversion units, if the teacher also meets the income eligibility criteria for those programs. If the teacher moves out of the City and County of San Francisco or leaves the San Francisco Unified School District within 5 years of the date the loan is issued, the loan must be paid back in full. After year five, the loan is forgiven at a rate of 20% per year, and at the end of the 10th year, the loan is forgiven in its entirety. The following chart illustrates repayments for TND loans.
If the property is sold or the teacher leaves the SFUSD, then the following is due back to the City:
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Year 1 $20,000 |
Year 6 $16,000 |
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Year 2 $20,000 |
Year 7 $12,000 |
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Year 3 $20,000 |
Year 8 $ 8,000 |
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Year 4 $20,000 |
Year 9 $ 4,000 |
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Year 5 $20,000 |
Year 10 $ 0 |
Refinance/Subordination – The City loan can be subordinated to refinance the existing first mortgage for a lower interest rate and better loan terms as long as no cash equity is taken out of the property. All refinances must meet MOH’s subordination requirements and be approved by MOH.
Loan Documents
After the TND loan has approved, the commitment is good for 45 days. The City will provide funds and closing documents to the title company for borrowers’ signatures.
TND Deed of Trust (pdf): The City Deed secures the loan against the title of the property. The City loan will subordinate to first mortgage.
TND Note (pdf): The City Note contains an acceleration clause, which will call the entire loan due and payable upon sale; rental and title transfer of the property. The City Note also outlines terms and repayments of the loan.
Owner Occupancy Requirements
Borrower must occupy the purchased property as its primary residence within 60 days after close of escrow. Properties that have received TND funding must remain owner-occupied throughout the term of the loan and never used as investments or rental property. Compliance monitoring may be performed and documented proof of occupancy required at intervals determined by Mayor's Office of Housing.
Application Process
Borrower must:
- Complete the first-time homebuyer education course through one of MOH’s 5 approved housing counseling agencies. A certificate of completion of homebuyer education must be included with the application package.
- Have a ratified purchase agreement before apply for the TND loan.
- Submit TND application (TND-1) (download the TND application from our website) to lender at the same time you apply for your first mortgage along with the following documents:
- A certification of a California teaching credential and employed by the San Francisco Unified School District.
- Complete set of past 3 years Federal income tax returns (included all schedules, signed and dated) and W-2 forms.
- Three current and consecutive pay stubs with year-to-date (YTD);
- Income Tax Affidavit (TND-3) - if applicable
- First Time Homebuyer Affidavit (TND-4)
- Homebuyer Education Certificate.
- Last 3 months bank statement for checking, savings & other pertinent investment accounts.
- Gift letter (if applicable)
- IRS form 4506
- Lender can send application along with required documentation to MOH.
- A letter of approval or denial will be sent to the borrower and lender within 10 working days of receipt a complete package.
To Download TND brochures: English (Printer-friendly pdf). For additional information, please contact Mayor's Office of Housing at 415-701-5500
Approved Housing Counseling Agencies
Asian, Inc.
1167 Mission Street, 4th Floor
San Francisco, CA 94103
(415) 928-5910
Nobby Cheng - ncheng@asianinc.org
Mission Economic Development Association (MEDA)
3505 20th Street
San Francisco, CA 94110
(415) 282-3334 Ext. 29
Elisa Baeza - ebaeza@medasf.org
San Francisco Consumer Credit Counseling Service of San Francisco (CCCSF)
595 Market Street, 15th Floor
San Francisco, CA 94105
(415) 788-0288 Ext. 147
Matthew Rizzie - mrizzie@housingeducation.org
San Francisco Housing Development Corporation (SFHDC)
4439 3rd Street
San Francisco, CA 94124-3117
(415) 822-1022 Ext. 112
Ed Donaldson - ed@sfhdc.org
San Francisco Urban Community Housing Corporation (SF Urban CHC)
1730 O'Farrell Street, Suite 124
San Francisco, CA 94115
(415) 252-0949
Cecilia Shepard - cshepard@sfurbanchc.org
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