No. The appraisals are much lower for FHA than conventional. It is better to finance with conventional loan on a HUD home, because you do not have to come out of pocket for the difference of your bid (if your bid is accepted). HUD homes have already obtained their (FHA) appraisal- the list price! FHA appraisals are what that particular home is worth in it's as-is condition (no repairs). If you finance with conventional loan, whatever dollar amount you bid over the list price is financed (minus your down payment of course!). You will need to order a conventional appraisal for your conventional loan (which is higher than FHA appraisal), and if the conventional appraisal comes in at your bid or higher, you can continue to close. If the conventional loan comes in lower than your bid, you will then have to come out of pocket with the difference because your lender will not allow you to finance more than what the home is appraised for or attempt to negotioate. If you negotiate the price of the HUD home, you risk losing it, there are investors dying to snatch up a good deal on a HUD home. Hope this helps buyers!