source:
  type: guide
  id: hud-4000-1-iii-f-good-neighbor-next-door
  authority: FHA Single Family Housing Policy Handbook 4000.1, Part III — f. Good
    Neighbor Next Door (03/31/2022)
  description: FHA Single Family Housing Policy Handbook 4000.1, Part III — f. Good
    Neighbor Next Door (03/31/2022).
  coverage_tier: operative
obligations:
- id: hud-4000-1-iii-f-good-neighbor-next-door-full
  canonical_id: hud-4000-1-iii-f-good-neighbor-next-door-full
  section: FHA Single Family Housing Policy Handbook 4000.1, Part III — f. Good Neighbor
    Next Door (03/31/2022)
  type: do
  tags:
  - regulator-direct
  - fha
  - hud-handbook
  - corpus-expansion
  - tier-operative
  primary_source:
    tier: 1
    authority: FHA Single Family Housing Policy Handbook 4000.1, Part III — f. Good
      Neighbor Next Door (03/31/2022)
    source_class: hud-handbook
    source_url: https://www.hud.gov/hud-partners/single-family-handbook-4000-1
    snapshot_id: 8c03836f77f317e1
    fetched_at: '2026-05-23T00:28:40Z'
    content_hash: sha256:411430f29b13f9b54a2ebb0e6f6e7087ecd2b90d0da22eb0c8c792eaa2d7d0df
    paragraph_quote: 'f. Good Neighbor Next Door (03/31/2022) i. Owner-Occupancy Term
      The Good Neighbor Next Door (GNND) participant must live in the Property as
      their sole residence for an owner-occupancy term of 36 months, beginning on
      one of the following dates: • 30 Days after closing if the home requires no
      more than $10,000 in repairs before occupancy; • 90 Days after closing if the
      home requires more than $10,000, but not more than $20,000 in repairs; or •
      180 Days after closing if the home requires more than $20,000 in repairs prior
      to occupancy. (A) Annual Certification (1) Standard GNND participants must certify
      on form HUD-9549-D, Good Neighbor Next Door: Sales Program, every year of the
      owner-occupancy term that they are living in the Property. HUD’s Loan Servicing
      Contractor will mail form HUD-9549-D to the GNND participant. The GNND must
      sign, date, and return the form according to the instructions in the letter.
      (2) Failure to Return Certification If the GNND participant fails to complete
      and return the annual certification, HUD will take action to determine whether
      the GNND participant still meets program requirements. These actions include,
      but are not limited to: • referral to an investigator, who may perform an on-site
      visit to verify the occupancy of the Property; and • referral to HUD’s Office
      of Inspector General (OIG) for further investigation and possible prosecution.
      (B) Term Interruption Requests When the GNND participant requires an interruption
      to the owner-occupancy term, the Borrower may request approval for a term interruption
      from HUD. The GNND participant must submit a written and signed request at least
      30 Days before the anticipated interruption to HUD’s Servicing Contractor. The
      request must include the following information: • the reason(s) why the interruption
      is necessary; • the dates of the intended interruption; and • a certification
      that: III. SERVICING AND LOSS MITIGATION A. Title II Insured Housing Programs
      Forward Mortgages 3. Programs and Products - Good Neighbor Next Door (03/31/2022)
      Handbook 4000.1 1356 Last Revised: 11/26/2025 o the GNND participant is not
      abandoning the home as their permanent residence; and o the GNND participant
      will resume occupancy of the home upon the conclusion of the interruption and
      complete the remainder of the 36-month owner-occupancy term. (C) Active Duty
      Military Service Eligible GNND program participants who are also military service
      members protected by the SCRA are not required to submit their written request
      to HUD 30 Days in advance of an anticipated interruption, but must submit their
      written request as soon as practicable upon learning of a potential interruption.
      HUD may grant exceptions to the occupancy requirement for participants who are
      called to Active Duty service. These participants must notify HUD when Active
      Duty military service would require temporary relocation outside of the commuting
      area of the Property purchased under the GNND program. (D) Failure to Complete
      Owner-Occupancy Term If the GNND participant sells their home or stops living
      in the home as their sole residence prior to the expiration of the owner-occupancy
      term, they will owe HUD the amount due on the second Mortgage as of the date
      the Property is either sold or vacated. ii. Second Mortgage and Note Servicing
      HUD’s Servicing Contractor is responsible for the servicing of GNND second Mortgages.
      GNND Participants must submit requests for subordinations, payoff amounts, mortgage
      releases, or other servicing information to HUD’s Servicing Contractor. (A)
      Subordinations To request subordination of a GNND Mortgage, the GNND participant,
      or the Closing Agent responsible for closing the new Mortgage must: • contact
      HUD’s Loan Servicing Contractor to receive a Subordination Information Sheet;
      and • submit the required documentation, as listed in the Subordination Information
      Sheet, to HUD’s Loan Servicing Contractor. (B) Payoffs To pay off a GNND Mortgage
      before the expiration of the owner-occupancy term, the GNND participant must
      submit to HUD’s Loan Servicing Contractor a request for a Payoff, including
      the following information: III. SERVICING AND LOSS MITIGATION A. Title II Insured
      Housing Programs Forward Mortgages 3. Programs and Products - Good Neighbor
      Next Door (03/31/2022) Handbook 4000.1 1357 Last Revised: 11/26/2025 • GNND
      participant’s name; • full property address; • estimated date of Payoff; • name,
      address, telephone number, and return fax number of the entity requesting the
      Payoff; and • signed permission of the GNND participant to collect this information.
      (C) Releases At the end of the required owner-occupancy term, HUD will release
      the GNND second Mortgage as long as all of the following conditions are met:
      • The GNND participant has completed and returned the required annual certifications.
      • The GNND participant is not currently under investigation by OIG. • The GNND
      participant is in compliance with all GNND regulations. HUD’s Loan Servicing
      Contractor will prepare this release and file the mortgage satisfaction with
      the GNND participant’s local county recorder’s office. III. SERVICING AND LOSS
      MITIGATION A. Title II Insured Housing Programs Forward Mortgages'
  judgment: false
