United Farm Workers


The Details

Rich Zahn ZMG Construction (Cesar Chavez/FAW 2015)

Rich Zahn says that each participant is defined as follows:

A teacher is understood to be a person who is employed full time by a public or private school or educational service. And in good standing with all the company.

Substitute teachers that are employed full-time (every day) on an on going, full-time, contract (standard teaching contracts are typically for 180 school days a year, or more) with a school system. These are workers who just work in an alternate school daily or for brief intervals in the exact same school.

Teachers need to buy property in the same school system where they educate - or in the case of a private school, within the radius where the school brings the students.

All participants will need to agree do a second mortgage and note that'll be for the amount of 50% of the price. In other words, if a home is bought with a list price of $100,000, there will be a second mortgage on the house that's NO monthly payment but will be recorded as a lien against the property for three years.

The occupancy restriction for system participants who buy HUD homes is that they have to occupy the property as their primary residence for three years starting on the date of the closure files. During the whole three year term, participants may not possess any other residential real property.

If someone currently possesses real property, it should be sold before closing on a GNND property.

Richard Zahn asserted that participants could be required to recertify each year to verify occupancy and compliance.

If for some reason you must move or sell the home prior to the end of the necessary three year period, you must repay 90% of the second mortgage during the very first year, 60% during the second year, 30% during the 3rd year and in the end of the three year interval the mortgage is forgiven.

The second mortgage is not computed in the payment. The second mortgage is a quiet second and needs no repayment with full program conformity.

The first mortgage on the property that will have a monthly payment will usually include more than only the other 50% of the list price. Close costs, fees & renovations can be financed in with the purchase amount.

If the purchaser will not have closure costs desired in cash, this amount could be added to the first mortgage. HUD does not pay any of a GNND participants closure prices since the home is being sold at a 50% discount. All closure costs will likely be calculated on the basis of the list price, not the discounted mortgage amount. Close costs including lender fees, transport charges, and settlement expenses might equal $8,000. The property may want $20,000 in renovations since it is being sold as-is. HUD houses are always sold as-is.

Rich Zahn states that the first mortgage on the referenced property will be a total of $83,000 ($50,000 discounted cost plus $5,000 fee plus $20,000 rehabilitation). As well as the payment would be calculated with the approximate loan amount of $83,000. That will make the realized discount on the property recorded at $100,000 an 83% discount, but it is important to notice that the discount is taken from the as-is value of the house. After advancements have been completed, the house's value would increase too. The upsurge in value may be more or less than the real cost of the renovations, but definitely more than the as-is worth. The discount would have to be computed based on the after-repair value.

The TND/GNND Plan has additional special requirements that should be fulfilled by program participants to be able to buy HUD homes at a 50% discount.


Host: Leslie Sirep
Gainesville (Gainesville, FL)
Gainesville, FL 32653

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