Educator Down Payment Assistance Act of 2022

To direct the Secretary of Education to award grants to provide financial assistance to certain educators to make down payments on certain homes, and for other purposes. 1. Short title This Act may be cited as the Educator Down Payment Assistance Act of 2022 2. First-time homebuyer down payment assistance program (a) Establishment The Secretary of Education shall award grants, on a competitive basis, to eligible entities to award subgrants to eligible educators in accordance with subsection (d). (b) Application An eligible entity seeking a grant under this section shall submit to the Secretary an application in such form, at such time, and containing such information as the Secretary determines appropriate, including an assurance that such entity will utilize an existing, or establish a new, down payment assistance program to award subgrants to eligible educators. (c) Geographic areas In the case of a geographic area that is served by an eligible entity that is a unit of local government and an eligible entity that is a local educational agency, the Secretary may only award a grant to 1 such entity in such geographic area. (d) Subgrants (1) In general An eligible entity that receives a grant under subsection (a) shall use such grant funds to award subgrants to eligible educators. (2) Application An eligible educator seeking a subgrant under this subsection shall submit to the eligible entity an application in such form, at such time, and containing such information as the eligible entity determines appropriate, including an assurance that such educator will— (A) complete the housing counseling required under paragraph (8); and (B) use an eligible residential mortgage loan to purchase an eligible dwelling. (3) Subgrant uses An eligible educator that receives a subgrant under this subsection shall use such subgrant funds to pay, with respect to the purchase of an eligible dwelling using an eligible residential mortgage loan, for— (A) direct down payment costs associated with such purchase; (B) closing costs associated with such purchase; and (C) costs related to reducing the rates of interest on such eligible residential mortgage loan associated with such purchase. (4) Subgrant amount (A) In general Except as provided under subparagraph (B), a subgrant awarded under this subsection may not exceed $25,000. (B) Exception In the case of an eligible educator purchasing an eligible dwelling that is located in a high-cost area (as determined by the Secretary based on area median income), a subgrant awarded under this subsection may exceed $25,000. (5) Subgrant limit An eligible educator may only receive 1 subgrant under this subsection. (6) Additional funds An eligible entity may award a subgrant under this subsection to an eligible educator who is receiving funds from other sources, including other State, Federal, local, private, public, and nonprofit sources, for the purpose of purchasing an eligible dwelling. (7) Occupancy requirement (A) In general An eligible educator who is awarded a subgrant under this subsection and makes a down payment on an eligible dwelling with such subgrant funds shall use such dwelling as a primary residence for a period of not less than 3 years. (B) Enforcement (i) Return of funds An eligible educator who does not comply with the requirement under subparagraph (A) shall return to the eligible entity the total amount of the subgrant funds awarded to such educator under this subsection. (ii) Timing Such funds shall be returned in accordance with clause (i) not later than 1 year after such educator ceases to use such dwelling as a primary residence in violation of the requirement under subparagraph (A). (iii) Exception An eligible educator who does not comply with the requirement under subparagraph (A) due to an emergency event shall not be required to return subgrant funds under clause (i). (8) Housing counseling requirement (A) In general An eligible educator shall provide to the eligible entity, in accordance with clause (iii), proof of completion of a program of housing counseling that— (i) is offered— (I) by a housing counseling agency that is approved by the Department of Housing and Urban Development; and (II) in person, virtually, by telephone, or by any other method determined by the Secretary to be acceptable; (ii) includes information with respect to— (I) the responsibilities and financial management required with respect to owning a home; and (II) fair housing rights and how to file a fair housing complaint; and (iii) is completed prior to filling out a loan application or entering into a sales purchase agreement. (B) Funding The Secretary shall reserve not less than 5 percent of the funds made available to carry out this section to pay for the costs of the housing counseling required under subparagraph (A) for eligible educators. (e) Definitions In this section: (1) Eligible dwelling (A) In general The term eligible dwelling (B) Limitation An eligible dwelling does not include a residential property that contains more than 4 dwelling units. (2) Eligible educator The term eligible educator (A) is a first-time homebuyer; (B) has served in their position or another position in the educational system for not less than a total of 3 years (without regard to whether such years were consecutive); (C) has a qualifying income; and (D) is in good standing. (3) Eligible entity The term eligible entity (A) a unit of local government; (B) a State housing finance agency; or (C) a local educational agency. (4) Eligible residential mortgage loan The term eligible residential mortgage loan (A) meets the underwriting requirements and dollar amount limitations for acquisition by the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation; (B) is made, insured, or guaranteed under title II of the National Housing Act ( 12 U.S.C. 1707 et seq. 42 U.S.C. 1471 et seq. (C) is a qualified mortgage, as such term is defined in section 129C(b)(2) of the Truth in Lending Act ( 15 U.S.C. 1639c(b)(2) (D) is made, insured, or guaranteed under chapter 37 (E) is guaranteed under section 184 of the Housing and Community Development Act of 1992 ( 12 U.S.C. 1715z–13a (5) Emergency event The term emergency event (A) military deployment; (B) divorce; (C) death of an eligible educator or spouse; and (D) other similar unforeseen events as determined by the Secretary. (6) ESEA terms The terms elementary school local educational agency other staff secondary school Secretary 20 U.S.C. 7801 (7) First-time homebuyer The term first-time homebuyer (8) Good standing (A) In general The term good standing (B) Period The period described in subparagraph (A)— (i) begins on the date that is 3 years before the date described in clause (ii); and (ii) ends on the date on which such educator submits an application under subsection (c). (9) Qualifying income (A) In general The term qualifying income (B) High-cost area If the Secretary makes a determination that an area described in subparagraph (A) is a high-cost area, the qualifying income shall be an income that does not exceed 180 percent of the median income of such area.

Summary: Educator Down Payment Assistance Act of 2022 This bill requires the Department of Education to award grants for assisting certain elementary and secondary school educators with the purchase of a first home (e.g., by providing direct down payment costs). Entities eligible for the grants include local governments, state housing finance agencies, and local educational agencies.