The Department of Housing and Urban Development is expanding its popular Officer Next Door program to include teachers.

Under the program, policemen -- and now educators -- who are willing to live in designated revitalization areas are offered at a 50 percent discount homes that have been foreclosed on by the Federal Housing Administration.

By attracting these vitally important professionals to the economically distressed neighborhoods where they are needed most, the Clinton Administration hopes to speed their return of these communities to vitality.

"Good neighbors help create good neighborhoods", said Vice President Al Gore.

The goal under the original program was to sell 1,000 houses. But to date, more than 2,750 policemen have purchase homes at half their appraised values since the initiative was announced by President Clinton at the U.S. Conference of Mayors meeting in 1997.

And beginning this month -- a month later than HUD had originally intended -- teachers will be able to get in on the act. The expanded program will bring educators into poorer, urban school districts where they are needed most, said HUD Sec. Andrew Cuomo.

Even with the discount, HUD says the two initiatives don't cost taxpayers any money.

Sales under the Office Next Door program are currently running at a pace of 1,200-1,500 a year. The program is active in 39 states and the District of Columbia. But to date, about a third of total sales have been in California, where some 985 policemen have taken advantage of the program. Sales also have been strong in Texas (236), New York (171) and Chicago (104).

About 6,000 of the 40,000 houses currently owned by the FHA are in designated revitalization areas, which are typically low and moderate-income neighborhoods with a large number of vacant properties and high crime rates. However, the communities also are considered good candidates for economic development and improvement.

Under the expanded program, any full-time public school teacher is eligible to buy a HUD-owned home if it is located in a revitalization area within the school district in which the teacher works. Cops, on the other hand, can buy outside the jurisdictions where they work.

Either way, though, both teachers and officers must promise to live in the houses they purchase for at least three years. After that, they may keep any profit they realize from the sale.

If occupants don't stay that long, the FHA will place a lien on their properties and the discount will have to be repaid based on how long they kept their properties.

If they remain less than a year, 90 percent would have to be returned to the government. If they stay less than two years, they would have to repay 60 percent of the discount. And if they stay less than three years, they would have to rebate 30 percent.

In addition to the price cut, the government also has reduced the downpayment requirement to just $100 if the home is purchased with an FHA-insured mortgage. And the Mortgage Bankers Association has urged its nearly 3,000 member firms to offer a choice of discounts, including a reduction in closing costs or a lower interest rate.

Teachers must use a real estate agent to arrange the sale. Alternatively, a local government or school district can purchase the house from HUD and then sell it to a teacher.

Only single-family homes, condominiums and townhouses are eligible. Two to four-unit properties are not.

For more information, teachers and officers can call 800-217-6970 or visit HUD s Web site at www.hud.gov/ond/ond.html.

Published: September 13, 1999

Use of this article without permission is a violation of federal copyright laws.

When Lew Sichelman first started writing about housing in 1969, he was the youngest real estate writer in the country. Now, 37 years later, he's one of the oldest -- and most decorated. He has been rated the top housing columnist in the country by the National Association of Realtors as well as by his peers in the National Association of Real Estate Editors. Indeed, NAREE has recognized his work on numerous occasions. One year - due to his advancing age, he can't recall which one - he earned top honors in the annual NAREE Journalism Contest in three out of the four major writing categories. It was the first time one writer has won so many NAREE awards in a single year. Known for his ability to make even the most difficult topics understandable, Sichelman also has been honored by the National Association of Home Builders and the Mortgage Bankers Association. He began providing in-depth coverage of and consumer-oriented information about housing and housing finance at the Washington Daily News, where he was real estate editor. He held that same position for nine more years at the Washington Star, which purchased the News in 1972. The Star, a so-called "writer's newspaper" which also had the misfortune of being an evening paper, was put out of its misery in 1981, and Sichelman, who had begun self-syndicating his column in 1978, decided to become a full-time columnist. Today, his column, "The Housing Scene," is distributed by United Media to newspapers throughout the country. He also is on the staff of National Mortgage News, an independent newspaper which is considered the bible of the mortgage business. And he writes for numerous other publications, including MarketWatch.com, where he answers readers questions once a week, Sports Illustrated (don't ask), RealtyTimes.com, BigBuilder and others. Sichelman is married, the father of five and grandfather of eleven.