Long Island Mortgages for Teachers

Teacher pay doesn’t look like most paychecks. You’re paid for 10 months of work, you can be on probation for four years before tenure, and coaching or summer pay changes from year to year. Here’s how a mortgage lender counts that pay, for teachers, teaching assistants, counselors and staff in Nassau and Suffolk, public or private.

How lenders count a 10-month teacher salary

Freddie Mac’s rule covers teachers directly: if your yearly salary is paid over fewer than 12 months, the lender divides it by 12. For example, $90,000 paid over 10 months is $9,000 a month while you’re working, but you qualify on $7,500. Checks that stop in June or run all summer count the same.

What matters is budget: the mortgage is due all 12 months, so set money aside for July and August if you’re not paid then. Use your full yearly salary in my affordability calculator.

Fannie Mae’s rules don’t mention 10-month pay, but they check your salary against what you’ve been paid so far this year. In summer or early fall, that number looks low. Have last year’s W-2 and your latest stub ready so the lender sees the whole year.

Do you need tenure to get a mortgage?

No. On Long Island, a new public-district teacher usually serves four years of probation before tenure. Conventional loan rules don’t make you wait that out. Your salary can count from your first year on the job. The lender still looks at your last two years of work history, and a shorter history can be fine when the rest of your file is strong.

If a loan officer says you need tenure, that’s their lender’s own rule, and a reason to compare. Comparing lenders is what I do.

First teaching job? Freddie Mac and FHA let recent years in college or a certification program help cover the two-year work history.

Teach outside the public system? You may have no tenure track and a new contract every year. That’s fine. Freddie Mac treats a yearly teaching contract as ongoing income unless the lender knows otherwise.

Buying a house as a new teacher

Starting a new job in September? Conventional loan rules let you close on a purchase over the summer with a signed offer letter, before the job starts. The job has to start within 90 days after closing, it has to be a one-unit home you’ll live in, and you qualify on your salary alone. Not every lender will do it, but I work with lenders that do. Talk to me before you sign a contract on a house. You’ll need:

• A signed offer letter or contract showing your employer, position, salary and start date. If the board’s appointment notice doesn’t list your salary, ask HR for a letter that does.
• Conditions cleared before closing, like fingerprint clearance or certification.
• Extra savings. On top of normal reserves, enough to cover the new house payment and your other monthly debt payments (car, student loans, cards) until you start, plus one more month.

FHA doesn’t spell out the same option. If FHA is the better fit for you, plan to close after your first paycheck, so you have a pay stub to show.

Step raise coming? If your employer confirms it in writing and it starts within 60 days after closing, Fannie Mae can count it on a purchase.

Got an offer for September? Text me at 631-250-6930 once it’s signed, or send me a note, and we’ll work out the closing date and how much to set aside.

Coaching stipends, summer teaching and second jobs

Your salary does most of the work. A stipend you got for the first time this year probably won’t count yet.

• Coaching stipends and extra-duty pay. Underwriters often treat these like overtime. They want at least 12 months of history, two years is better, and they average it.
• Summer teaching. Freddie Mac’s own example is a teacher who taught summer classes last year and is teaching them again this year. That can count. Fannie Mae usually wants two summers.
• A second job, like tutoring or part-time work outside the district: two years is the norm, and 12 months can work when the rest of your file is strong, though not on FHA. Tutoring on a 1099? See my self-employed guide.

Your NYSTRS pension, 403(b) and savings

Your pension (NYSTRS, or the state Employees’ Retirement System for support staff) usually won’t count as savings, because you can’t take that money out while you’re working.

A 403(b) or 457 is different. A vested balance counts only if the plan lets you take money out while you’re still working. Not every plan does, so the underwriter checks your plan’s rules. You don’t have to cash it out. Teach outside the public system? Then your 403(b), if you have one, is the account that matters.

Thinking of borrowing from NYSTRS or your 403(b) for the down payment? NYSTRS lets you borrow against your own contributions once you have a year of service credit and a minimum balance, and a 403(b) may allow a loan. An unpaid loan can cost you in taxes, and with NYSTRS, a smaller pension. And the IRS’s $10,000 first-time buyer break on early withdrawals is for IRAs, not a 403(b). Talk to the plan and a tax pro first, then bring me the loan papers. With them, a lender may not count the payback as a monthly debt.

Is there a special mortgage for Long Island teachers?

Not the way the ads make it sound. Fannie Mae, Freddie Mac and FHA don’t have a loan just for teachers. You’d use the same loans anyone else does: a conventional loan or an FHA loan, or a VA loan if you served. My loan programs page compares them.

Need down payment help? I offer private down payment assistance programs available through lenders I work with; terms and eligibility vary by program and lender, and not everyone will qualify. My down payment assistance page covers how they work.

If your union or a lender sends you a “teacher” mortgage offer, put its Loan Estimate next to other quotes. Every lender uses the same form.

Documents to gather

My mortgage document checklist has the full list, with the reason for each item. The short version:

• Your signed offer letter, if you’re starting a new job
• Recent pay stubs and W-2s
• Written confirmation of any raise that starts after closing
• 12 months or more of pay records for stipends, summer teaching or a second job
• Your latest 403(b), 457 or other retirement statements, and the loan papers if you’ve borrowed against one
• An HR or payroll contact who answers email in July and August

That last one matters for summer closings. The lender re-checks your job right before closing, usually within 10 business days, and Fannie Mae accepts written confirmation, not just a phone call.

Buying for the first time? Start with my first-time home buyer guide.

Frequently asked questions