Who qualifies for the Good Neighbor Next Door program in Texas?

Full-time law enforcement officers, pre-K through 12th grade teachers at state-accredited public or private schools, firefighters, and emergency medical technicians (EMTs) may qualify. You must serve the locality where the home is located, hold the eligible job at bid and at closing, and certify a good-faith intent to stay in that profession for at least one year after closing.

How does the 50% Good Neighbor Next Door discount work?

HUD provides the 50% discount by having you sign a silent second mortgage and note payable to HUD for the difference between the list price and the discounted price. You make no interest or payments on that second mortgage as long as you live in the home as your sole residence for 36 months. At the end of three years, HUD releases the second mortgage if you have returned your annual occupancy certifications and stayed in compliance.

Is the 50% discount based on the list price or the appraised value?

HUD's main program page and federal regulation 24 CFR 291.510 state the discount is 50% off the list price of the home, while the HUD Homestore FAQ states it is 50% off the HUD appraised value. Because the two official sources conflict, this guide follows the regulation (list price), and buyers should confirm how the discount is calculated on a specific property with their HUD-registered broker or HUD's FHA Resource Center.

What happens if I move or sell before the 36 months are up?

Under 24 CFR 291.550, the silent second mortgage balance drops by 1/36th for each month you occupy the home. If you sell the property or stop living there as your principal residence before completing month 36, you owe HUD the remaining prorated balance of that second mortgage.

Can I use an FHA loan with a $100 down payment on a Good Neighbor Next Door home?

Yes. Under 24 CFR 291.510 and the HUD Homestore FAQ, Good Neighbor Next Door buyers who use an FHA-insured mortgage have a $100 down payment. You still need to qualify for the FHA loan with a lender.

Where can I find Good Neighbor Next Door homes in Texas?

All eligible properties are listed on HUD Homestore and must be single-unit, HUD-owned homes inside HUD-designated revitalization areas. To see current Texas inventory, select Texas on the HUD Homestore map and click the Good Neighbor Next Door tab. Eligible homes are listed for 7 days, and listings change weekly.

Good Neighbor Next Door Texas: 50% Off HUD Homes (2026)

Police officer and teacher couple in front of a home in a revitalizing Texas neighborhood

Buying a home in Texas on a teacher, police officer, firefighter, or EMT salary can feel out of reach.

This 2026 guide explains how HUD's Good Neighbor Next Door program in Texas offers eligible public servants 50% off select HUD-owned homes, how the 36-month silent second mortgage works, and how to search Texas listings.

Check Your Texas Home Purchase Eligibility

You will walk away knowing whether your job and household meet HUD's strict rules, how the 7-day lottery works, and which state-level alternatives to compare if no HUD homes are available in your area.

What Is the HUD Good Neighbor Next Door Program in Texas?

The HUD Good Neighbor Next Door (GNND) program helps full-time law enforcement officers, teachers, firefighters, and EMTs buy HUD-owned homes in HUD-designated revitalization areas in the communities they serve. As of October 26, 2026, HUD's program page shows no suspension notice, so the program appears to be active.

If you win a property through GNND, you buy a single-unit, HUD-owned home at a 50% discount. In exchange, you must live in the home as your sole principal residence for 36 months and sign a "silent" second mortgage for the discounted amount.

Because GNND sales are capped by federal regulation (24 CFR 291.510) at 5% of the prior fiscal year's "Part A" FHA conveyance claims, it helps to keep other options in view. You can compare broader statewide options in our 58 Texas First-Time Home Buyer Grants & Programs (2026) guide so you are not relying on a single lottery.

List Price vs. Appraised Value: A Wording Conflict to Confirm

Before you bid, be aware of a wording difference across HUD's own websites:

HUD.gov and federal regulation (24 CFR 291.510): State that the buyer receives a discount of 50% from the list price of the home.
HUD Homestore FAQ: States that the buyer receives 50% off the HUD appraised value.

This guide uses "list price" because that is what the regulation says, but you should confirm the exact discount base on any property you bid on with your HUD-registered real estate broker or by calling HUD's FHA Resource Center at 800-225-5342.

Who Qualifies for Good Neighbor Next Door in Texas?

To participate in Good Neighbor Next Door Texas, you must meet strict employment, locality, and prior-ownership rules under HUD guidelines and 24 CFR 291.515.

Requirement Category	HUD Rule for Texas Buyers
Eligible Professions	Full-time law enforcement officers, pre-K–12 teachers, firefighters, and EMTs
Locality Rule	You must serve the locality where the home is located
Employment Timing	Must hold the eligible job at bid and at closing, and certify good-faith intent to stay in it for at least 1 year after closing
Prior Homeownership	Neither you nor your spouse may have owned residential real property during the year before the bid
Past Program Use	Neither you nor your spouse may have previously bought a home through GNND, Officer Next Door, or Teacher Next Door
Occupancy Commitment	Must live in the home as your sole principal residence for 36 months

Eligible Professions in Detail

HUD defines the eligible jobs specifically:

Law enforcement officers: You must be employed full-time by a federal, state, local, or tribal government law enforcement agency, and carry sworn authority to make arrests.
Teachers: You must be employed full-time as a teacher at a state-accredited public or private school that serves students from pre-kindergarten through grade 12 in the area where the home is located.
Firefighters: You must be employed full-time as a firefighter with a fire or emergency medical services unit of a federal, state, local, or tribal government serving the area where the home is located.
Emergency Medical Technicians (EMTs): You must be employed full-time as an EMT with a fire or emergency medical services unit of a federal, state, local, or tribal government serving the area where the home is located.

Check Your Texas Home Purchase Eligibility as a First Responder or Teacher

What Homes Are Eligible? HUD Revitalization Areas Explained

You cannot apply the Good Neighbor Next Door discount to just any house on the market. Under 24 CFR 291.510, eligible properties are limited to single-unit, HUD-owned homes located inside HUD-designated revitalization areas.

HUD designates revitalization areas by considering three factors:

Household income
Homeownership rate
FHA foreclosure activity

HUD excludes occupied properties, homes located inside Asset Control Areas, and properties that HUD chooses to sell through alternative disposition methods. You can view revitalization zones on HUD's Single Family Home Locator map or check the quarterly spreadsheet published by HUD.

How the 36-Month Occupancy Rule and Silent Second Mortgage Work

The 50% discount is not a cash handout at closing. Instead, HUD secures the discount using a silent second mortgage and promissory note payable to HUD for the difference between the list price and the discounted price you pay.

Here is how the silent second mortgage works under HUD rules and 24 CFR 291.550:

No monthly payments or interest: You pay zero interest and make no monthly payments on the second mortgage as long as you fulfill the occupancy requirement.
Prorated monthly forgiveness: The balance of the silent second mortgage drops by 1/36th for each month you live in the home as your sole residence, reaching zero at the end of month 36.
Annual certification: HUD mails you an occupancy certification every year. You must sign and return it to prove you still live there. If you fail to return it, HUD may investigate — including conducting an on-site visit or referring the case to the HUD Inspector General. Falsifying a certification is a felony.
Release after three years: Once you complete 36 months of occupancy and have returned your required certifications in compliance, HUD releases the second mortgage.
Early move-out or sale: If you sell the home or stop living in it as your principal residence before month 36, you owe HUD the remaining unforgiven fraction of the second mortgage.

How to Search and Bid on Good Neighbor Next Door Homes in Texas

GNND homes are listed on HUD Homestore for a short window, so preparation matters.

Step 1: Search HUD Homestore for Texas Listings

To check current inventory:

Go to HUDHomestore.gov.
Click Texas on the map, or search by Texas state, city, or ZIP code.
Select the "Good Neighbor Next Door" tab (which appears as a drop-down menu on mobile devices).
Review the map and list, which will now filter to show only GNND-eligible properties in Texas.

Step 2: Work With a HUD-Registered Broker

Buyers cannot submit bids directly on HUD Homestore by themselves. According to the HUD Homestore FAQ, all bids must be submitted through a HUD-registered selling broker or agent, or through the listing broker.

Step 3: Enter the 7-Day Lottery

Eligible GNND homes are listed for 7 days, and listings change weekly.

Lottery selection: If more than one eligible buyer submits a bid during the 7-day window, HUD selects the winner by random lottery. Under 24 CFR 291.510, HUD also selects two backup bidders.
Strict timing rule: Per the HUD Homestore FAQ, the 50% GNND discount applies only during the 7-day Lottery phase. Once that 7-day window closes, GNND buyers can no longer get the 50% discount on that property.

Check Your Texas Home Purchase Eligibility Before You Bid

Financing the Remaining 50%: FHA $100 Down and Other Options

You still need to pay for the remaining 50% of the purchase price (plus closing costs) using cash or a first mortgage from a participating lender.

The $100 Down FHA Option

Under 24 CFR 291.510 and HUD Homestore rules, if you finance your Good Neighbor Next Door purchase with an FHA loan in Texas, your required down payment is just $100.

To use this feature, you and the home must meet standard Texas FHA loan requirements and stay within Texas FHA loan limits by county. Keep in mind that HUD-owned homes may need repairs. Under HUD Handbook 4000.1, FHA appraisals check that mechanical systems, plumbing, heating, electrical, and the roof (which needs at least 2 years of remaining physical life) meet Minimum Property Requirements. If the home needs more substantial work, ask your lender whether FHA 203(k) loans in Texas are an option for your transaction.

Other Loan Types

The $100 down payment applies when you use an FHA-insured mortgage. If you are weighing other Texas home loan options, such as conventional financing or VA loans in Texas, ask a participating lender how that loan type works with a GNND purchase. Review the general requirements to buy a house in Texas to get your credit and income documentation ready before a 7-day listing window opens.

Once you close and move in, remember to file for your primary residence tax break using our Texas Homestead Exemption Guide (2026).

Texas Alternatives When No HUD Homes Are Available

Because GNND homes are limited to HUD-owned properties in revitalization areas, it makes sense to also look at state and local assistance programs that let you buy any qualifying home on the open market.

Homes for Texas Heroes: Administered by the Texas State Affordable Housing Corporation (TSAHC), the Homes for Texas Heroes program offers 30-year fixed-rate first mortgages with down payment assistance options to full-time eligible professionals such as public K-12 educators, peace officers, firefighters, EMS personnel, and veterans, without restricting you to HUD-owned listings.
Other Statewide Programs: TDHCA's My First Texas Home Program and My Choice Texas Home Program, and TSAHC's Home Sweet Texas Home Loan Program, are worth comparing, subject to Texas homebuyer income and purchase price limits.
City-Specific Assistance: Depending on where you serve, you can also compare local assistance in major metros, including the Houston Homebuyer Assistance Program (2026), the Dallas Homebuyer Assistance Program (2026), San Antonio Homebuyer Assistance Programs (2026), and Austin Down Payment Assistance (2026).

Buyers apply for state and local programs through a participating lender. Our team at Make Texas Your Home helps you check your eligibility, compare your options side by side, and get connected with the right loan setup.

Bottom Line: Your Next Steps

HUD's Good Neighbor Next Door program offers a 50% discount and a $100 FHA down payment for Texas teachers, law enforcement officers, firefighters, and EMTs who are willing to live in a HUD revitalization area for three years. Because properties only stay in the lottery for 7 days, getting your mortgage pre-approval lined up first and comparing backup programs like Homes for Texas Heroes puts you in a stronger position in 2026.