Home Buying in Texas>Question Details

Molly Moultb…, Other/Just Looking in Alvarado, TX

What is a HUD house and how does financing requirements differ?

Asked by Molly Moultbia, Alvarado, TX Sun Dec 5, 2010

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Hud Homes can be a very good deal for some, I personally have not seen many in very good shape, but there are a few gems out there. These are FHA loans gone bad, and they need to be absorbed back into a regular market so that FHA can recoop their loses!
0 votes Thank Flag Link Mon Dec 6, 2010
HUD homes are simply homes foreclosed by FHA. Therefore, FHA started offerring $100 downpayment financing in order to attract people to those homes ( which tend to be more beat up and in worse conditions and neighborhoods). Otherwise, all the requirements of an FHA mortgage would apply.

Andrew and Elena Ollick
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eo@oceanhomesrealty.com
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0 votes Thank Flag Link Mon Dec 6, 2010
Bruce provided a great answer.
HUD homes have special financing thru FHA.
Only $100 down payment.
0 votes Thank Flag Link Sun Dec 5, 2010
HUD homes are homes that originally had FHA government guarantee on the loan for the previous buyer. They defaulted and the government has repurchased them from the lender.

Typically financing requirements are no different. You go to your preferred lender, get prequalified, and then find the right home for you. My suggestion is you look at a variety of homes...HUD foreclosures, normal foreclosures, and straight sales.

The HUD homes are sold on an auction basis. That means you must bid with others for the home. The highest net bid to HUD wins the home on a specified date, although not just any highest bid wins. We often see the nicest homes sell very close to or above their list price. The asking price is the appraised value.

Hope that helps.
0 votes Thank Flag Link Sun Dec 5, 2010
Bruce Lynn, Real Estate Pro in Coppell, TX
MVP'08
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A HUD house just means that there was a HUD loan on the property that got foreclosed on and now HUD is selling the property.

Financing sometimes can be easier depending on the property.

If it is HUD financing eligible, then there will not be an appraisal making things go faster and sometimes smoother.

Good luck!
Web Reference: http://fglick.com
0 votes Thank Flag Link Sun Dec 5, 2010
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