The U. S. Department of Housing and Urban Development (HUD) wants to make American communities stronger and to build a safer nation. Public safety improves when police officers live in or near the nieghborhoods they serve. The Officer Next Door (OND) program is designed to further this goal by encouraging Law Enforcement Officers to purchase homes in low and moderate-income neighborhoods within the Logan City Revitalization Areas (See map above and click to enlarge).

Who can participate?

You must be a full-time, sworn law enforcement officer who is "employed full-time by a Federal, State, County or Municipal Government; or a Public or Private College or University." You must be "Sworn to uphold, and make arrests for violations of, Federal, State, County, or Municipal Law (i.e., FBI, US Marshals Service, Utah Highway Patrol, Cache County Sheriff's Department, Logan City Police, North Park Police, perhaps Utah State University Police and more) ."

As an officer, you must possess the general powers of arrest - not just arrest authority limited to one buildings or facilities, or a specified group of people.

For example, "correctional officers" are generally not eligible for the program unless they are sworn law enforcement officers with general arrest powers outside a correctional facility. (Personnel employed by the U.S. Federal Bureau of Prisons under the provisions of Title 18, USC, Section 3050 are eligible to participate). Other criminal justice employees such as probation and parole officers, court services officers, etc. are also generally not eligible for the program unless they are sworn law enforcement officers with general arrest powers outside specific facilities or groups of people.

Your employer must certify that you are a full-time police officer with the general power of arrest. You don't have to be a first-time homebuyer to participate. However, you cannot own any other home at the time you close on your OND home. You must agree to live in the HUD home as your only residence for three years after you move into it. Additional details and rules are available upon contacting Brady Pierce at (435) 787-8351. 

Where would these HUD Homes be located?

The OND homes, when available, are found within three areas of the City of Logan: 1) On the west side varying from 600 West to 300 West to Main Street and from approx. 200 North to 1000 North; 2) The west side of Highway 89-91 varying from 100 South to 1750 South and varying from 750 West to 50 West (Areas surrounding Logan River Golf Course to County Fairgrounds to Logan High School); and 3) The east side of Logan starting at 200 East to 500 East and varying north of the Boulevard (above Canyon Road) to 700 North. Call Brady Pierce at (435) 787-8351 and he can provide you with a highlighted color map of the Revitalization Areas and his HUD Hunter Program.

Over the last year (2004), of the 22 Logan HUD Foreclosures that have sold, only ONE home was within the Revitalization Area - Please be prepared to ACT quickly when one does become available.

How do I participate?

OND property is listed and sold exclusively over the internet. Properties are single-family homes located only within the Logan City Revitalization Areas. Properties available through the program can be located by Brady Pierce through his HUD Hunter Program. To sign up email bradypierce@comcast.net. Your bid must be the amount of the list price. Brady Pierce can be reached at (435) 787-8351 to place your Electronic Bid. In the event of multiple bids (which almost always happens) HUD, by computer, selects the winning bid - it is in all respects a Lottery.

You may also buy the home from a government agency or a nonprofit organization that bought the home from HUD (which does not happen very often in Logan, Utah). When an agency or nonprofit buys the house, HUD expects the full discount to be passed on to you.

In all cases, HUD requires that you sign a "Silent Second" mortgage note for the discount amount. No interest or payments are required on this "Silent Second" provided you fulfill the three-year occupancy requirement.

What are the benefits for the Officer?

The selected bidder may purchase the property at a 50 percent discount from the list price (which is typically below the appraised value). For example, if a HUD home is listed for $100,000, a qualified peace officer can buy it for $50,000. To make a HUD home even more affordable, you can apply for an FHA-insured mortgage with a downpayment of only $100 and you may finance all the closing costs. If you are first time homebuyer, you could also use Utah Housing Funds that typically has a 1/2 percent lower interest rate over FHA rates.

If the home you want to purchase needs repairs, you may also be eligible to use FHA's 203(k) mortgage program. This program allows you to finance both the purchase of the home and the cost of needed repairs. You have the benefit of one loan for both costs and one monthly payment.

Discuss these financing options with your lender or contact Brady Pierce at (435) 787-8351 and ask for assistance.

Because homes sold through the OND program are located within the Logan City Revitalization Areas there may be additional assistance from state or local government sources. Local or state governments want to encourage families and businesses to move into Revitalization Area neighborhoods. Contact Brady Pierce at (435) 787-8351 for additional information about local resources.

How much of a discount can I get on a HUD Home?

You can get a 50 percent discount off the HUD list price. For example, if HUD lists a home at $100,000, you can buy it for $50,000. If you qualify for any FHA-insured mortgage program, your downpayment is only $100.

How does the Program work, and what kind of Mortgage Financing do I need?

You may use FHA, VA, or conventional mortgages, or cash. HUD requires you to sign a Second Mortgage and Note on the discounted amount (which is $50,000 in the example above). No interest or payments are required on this "silent second" mortgage if you live in the home for 3 years.

What is HUD's FHA 203(k) Rehabilitation Mortgage and how can it help me buy a HUD Home?

The FHA 203(k) mortgage program helps homebuyers buy a home and have enough money to rehabilitate or repair it. Repairs must cost more than $5,000. The cost of the repairs and the mortgage are combined into a single monthly payment.

Can I sell the Officer Next Door Home after 3-years and keep the profit?

Yes. After you live in the OND home 3 years, you can sell the home and keep any equity and/or appreciation.

No, but you must not own any other residential real property when you close on your OND home. You must live in the HUD home as your sole residence for the full, 3-year, mandatory occupancy term.

Does HUD provide a Home Warranty?

No. All Officer Next Door homes are sold "as is," without any kind of warranty.

Can I buy Multiple Unit Properties (E.g., Duplexes, Triplexes, Etc.) through the Officer Next Door Program?

No. You can only buy single unit homes, townhouses, and condominiums through the Officer Next Door Program.

Do I have to pay Earnest Money or other deposits in order to submit a contract for an OND Home?

No. If you chose an FHA insured mortgage such as the FHA 203(b) or FHA 203(k), you only need a $100 downpayment. If you get a conventional mortgage, your mortgage lender sets the amount of the downpayment. You don't have to pay any other earnest money deposits.

Can I bargain with HUD on the price of an Officer Next Door property?

No. You must offer the exact HUD list price when "bidding" on any Officer Next Door property. Then you get a 50 percent discount off of that list price.

What if I leave my Law Enforcement Agency, for any reason, during the mandatory 3-year residency period?

Nothing happens, but you must continue to live in the home for the full 3-year mandatory occupancy period. If you don't, you will have to re-pay HUD on a prorated schedule.

Some Agencies have other Homebuying Programs. Can the Officer Next Door Program work in conjunction with these?

Yes, as long as you can meet all the Officer Next Door program rules while participating in these other programs.

What happens if an Officer fails to honor the 3-year Residency Requirement?

First of all, HUD can demand re-payment of the discounted amount in full or on a prorated basis. That means you would have to re-pay 90 percent of the discount during the first year, 60 percent during the second year, and 30 percent during the third year. HUD also may initiate administrative sanctions including, but not limited to, barring the officer from participating in any HUD/FHA programs, as well as other federal programs. In any case of fraud or abuse, HUD will refer the case to HUD's Office of the Inspector General for investigation and possible criminal prosecution. HUD may also notify the officer's employing agency. Criminal prosecution and conviction for fraud and abuse concerning the OND Program can result in a fine of up to $250,000 and/or two years in federal prison.

How does HUD enforce the 3-year Residency Requirement?

The officer must certify he or she is living in the OND home as a sole residence at the time of purchase and each year after that. HUD can conduct "spot checks" to make sure the OND home is your sole residence at any time during the 3-year period.

Brady Pierce can be reached by calling (435) 787-8351.

HomeBased Realtors is an authorized selling broker for HUD -- Equal Housing Opportunity.

 *All information deemed reliable and subject to change without notice.