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HELPER Act Aims for Zero Down Loans for Teachers, First Responders

Proposed legislation recently introduced to the House of Representatives seeks to create a zero-down loan program for teachers, law enforcement officers, and first responders.

The Homes for Every Local Protector, Educator, and Responder Act — known as the HELPER Act of 2021 — was drafted to address the financial hurdles educators and first responders face while trying to find affordable housing in the communities they serve.

The legislation passed through the House Committee on Financial Services on May 13 and will require votes in the House and Senate before being signed into law.

What’s in the HELPER Act?

The HELPER Act is a bill that would amend the National Housing Act to establish a mortgage program through the Federal Housing Authority (FHA) specifically for first responders, law enforcement, and educators.

The program would be similar to a VA loan, in that it requires zero down payment and no monthly insurance premiums. However, it does require an upfront mortgage insurance payment (MIP) of 3.6% of the loan amount — although this figure may be subject to change.

The loan would be one-time use only and applied to specific purposes:

  • To purchase, construct, or repair a single-family residence, including a condo
  • To purchase a manufactured home or a manufactured home and a lot
  • The property must be the primary residence for the life of the loan

As an FHA product, this mortgage would likely be available at most mainstream lenders.

Who would qualify for this loan?

As the title suggests, this program is designed for law enforcement, educators, and first responders. However it does mention specific titles and eligibility requirements.

Borrowers must employed full-time:

  • By a federal, state, or local government law enforcement agency;
    • and sworn to uphold the law or authorized to supervises sentenced criminal offenders (presumably including correction facility staff)
  • As a firefighter, paramedic, or emergency medical technician (EMT) by a unit of federal, state, or local government
  • As a teacher at an accredited K-12 public or private school

The borrowers must be employed for four or more consecutive years or released from employment due to a work-related disability. They must also be in good standing with the employer (not on probation or under investigation) and intend to continue their service.

Origins of the HELPER Act

Samuel P. Royer, a Marine Corps veteran and the national director for Heroes First Home Loans, birthed the idea for the HELPER Act. Royer said the idea is that first responders deserve the same access to affordable housing benefits that he has as a veteran.

The proposal was introduced to the Financial Services committee by Representatives John Rutherford (R-FL), Al Lawson (D-FL), Bonnie Watson Coleman (D-NJ), and John Katko (R-NY) and now features bipartisan support from 12 cosponsors.

While it has a long way to go before becoming law, early bipartisan support is a hopeful sign as rising home prices continue to squeeze homebuyers out of the market.

Fairway is not affiliated with any government agencies. These materials are not from the VA, HUD, FHA, USDA, or RD, and were not approved by a government agency.

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