Your dedication to Jewish education is helping secure the future of the Jewish community.
Now we want to help you set down roots in a community that needs you.
Shorashim: The Interest-Free Housing Loan Program for Day School Teachers provides interest-free loans of up to $50,000 to cover the down payment and closing costs associated with buying a home.
Loans are repayable interest-free over ten years, with half of the obligation forgiven over the ten-year amortization period, provided that you continue to teach in a local day school in accordance with the terms of the program.
The loan program, administered by the Hebrew Free Loan Society of New York, is open to full-time Judaic studies teachers in Baltimore, Cleveland, Dallas, Denver and Houston with at least three years teaching experience who are purchasing a home for no more than $400,000. Loans must be secured by either a guaranty from a creditworthy friend or relative, or a second mortgage.
How do I decide whether to opt for a second mortgage or to secure my loan with a guaranty?
If my proposed guarantor does not meet your requirements,can I replace him/her?
Am I eligible for a loan?
You are eligible for the program if you are currently, or will be, after moving, a full-time Judaic studies teacher, in Baltimore, Cleveland, Dallas, Denver or Houston and purchasing a home for no more than $400,000. Full-time means no less that 20 classroom hours a week. Administrators with at least ten Judaic studies classroom hours are eligible as well. You must be a K-12 teacher in a school with at least 50 students. You must also have at least three years of full-time Judaic studies teaching experience in any Jewish day school when you apply for the program
How do I secure my loan?
The loan program requires that loans be secured by either the personal guaranty of a creditworthy friend or relative with an annual income of at least $50,000, or a second mortgage. The guarantor, if any, is legally liable to repay the loan if you are unable to do so.
How do I decide whether to opt for a second mortgage or to secure my loan with a guaranty?
The second mortgage option is more complex and more costly than the guarantor option. If you have someone who is willing to guaranty the loan for you, you should seriously consider this option. We strongly suggest you consult your attorney in making this decision.
If my proposed guarantor does not meet your requirements, can I replace him/her?
Yes. If your proposed guarantor does not meet our requirements, we will let you know and give you the opportunity to choose someone else or opt for a second mortgage.
What is my monthly payment?
Throughout the term of a $50,000 loan, assuming the loan forgiveness applies, the monthly payment is $208.33.
How do I make loan payments?
Monthly loan payments will automatically be deducted from your checking account. The Electronic Funds Transfer Authorization form is one of the Closing Documents.
How does the loan forgiveness work?
On each anniversary of your first loan payment, provided that your payments are up to date, 5% of your debt will be forgiven and formally deducted from your outstanding principal balance. After ten years, you will have repaid 50% and been forgiven 50%.
In order to earn the forgiveness of 5% on your debt each year, you must be completely current on all loan payments on the anniversary of your first loan payment. Thus, if your first payment on a $50,000 loan was made on January 20, 2008, $2,500 of your debt will be forgiven as of January 20, 2009 if you have then repaid $2,500 ($208.33 X 12) of your outstanding principal amount. Payments can be made up to become current and thereby eligible for forgiveness.
If at any point you default on the loan, you will be liable immediately for the entire outstanding principal balance.
What happens if I sell my home, move to another city or leave day school teaching before I repay my loan?
If you sell your home, move to another city and/or stop teaching full-time at a day school (except for reasons of illness or involuntary termination) the outstanding principal balance on your loan becomes due and payable. This means you (or your guarantor, if any) are liable for immediate repayment for the entire principal amount of the loan outstanding at that point. If you leave day school teaching due to illness or involuntary termination, the loan will be repayable over the original term but no additional loan forgiveness will apply, leading to higher monthly payments.
What is the loan application process?
