what are the qualifications to buy a hud home. How much $ down on average?

Asked by Coconut64, Hermiston, OR Thu Feb 10, 2011

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12
Kellytimmi, , Elk Grove Village, IL
Thu Jul 23, 2015
Here are the different types of special financing you can receive when purchasing a HUD home as your primary residence:

$100 Down Program – You can purchase a HUD Home with only $100 down! While the buyer is still responsible for the earnest money and must submit to typical FHA lending guidelines, this is a great program for first-time home buyers looking to purchase a home.

Good Neighbor Next Door (GNND) – Designed to enhance urban communities, this type of financing offers discounts to firefighters, EMT’s, police and teachers. They receive 50% off the property list price and require only a $100 down payment. There are some minimum guidelines, though. The property must be located in a designated revitalization area, and the buyer must live and work in the same county as the home. Also, the buyer must live in the home for at least 36 months.

203(B) Repair Financing – If the HUD home you are looking at needs under $5,000 of repair work, you can finance the cost by using the 203B loan. This is available on 1-4 unit single family real estate, manufactured housing and condos.

203(K) Streamlined Financing – Allowing for up to $35,000 in repairs, this loan was developed to address properties in need of smaller repairs. This includes repair, replacement and upgrad as well minor remodeling and even painting. You can also finance appliances (not to exceed $2,000) with this loan.

Energy Efficiency Mortgage (EEM) – Aimed at increasing energy efficiency, this loan allows buyers to finance 100% of a cost effective “energy package”. The cost of the improvements, including maintenance, is less than the present value of the energy saved over the useful life of those improvements. Plus, an EEM may be used with 203(B) and 203(K) loans.

Click here for more information: http://fhamortgageinfo.com/
3 votes
Sandi Bunyard, Agent, Hermiston, OR
Mon Feb 14, 2011
HUD homes will not allow for repairs to be made prior to closing which may be required by the Lender in order for funding. This is the main hang up. For example, if there is dry rot from a plumbing leak in the bathroom , the Lender's underwriters must to require that repairs are made prior to closing for a traditional FHA loan. This is a paradox due to the fact that HUD will not allow repairs to be done on the property, with the exception of property clean up that they may order, prior to closing. HUD only allows 45 days to close the deal, and if you choose to do a 203k loan which will include costs of repairs, it will likely take longer than the 45 days. Then a stiff and painful penalty kicks in that is charged per day until closing.

The trick is, that if you like a HUD home, it needs to be an 'all cash' deal where no underwriters are involved, or or it needs to be a home where there are no 'Lender or appraiser required' repairs which means that the home needs to be in very good condition. Hope this helps!
Web Reference:  http://SandiSironRealtor.com
3 votes
Andrea Gomez, Other Pro, San Antonio, TX
Sat Oct 5, 2013
Talk to a mortgage broker who can help you, there are many different loan programs for HUD home. The Lenders Network would be your best bet to start with.
1 vote
Dave Sutton, Agent, Portland, OR
Thu Feb 10, 2011
More information is at the HUD web site, including a site that which show you which homes are listed in your area. http://www.hud.gov/offices/hsg/sfh/reo/reobuyfaq.cfm

One of the nice things is that they respond very quickly to offers (much quicker than most banks. If you're buying as an investor (instead of to live in yourself), you are "locked out" from offering for 10 days after it's listed, to give priority to owner-occupieds.
1 vote
Jeff Nunley,…, , Eugene, OR
Thu Feb 10, 2011
There are two answers to this question. If the home is situated in an area where the HUD appointed servicer (the M&M Contractor) allows the $100 HUD program you cna do an FHA loan with as little as $100 down payment. I don't beleive that is an option in Hermiston but it would pay to check.

Other than that, the home can be purchased with any loan program. If you use USDA you can get 100% financing if you qualify. If you use FHA you would put 3.5% down but you can use the M&M Contractors appraisal so you would not have to purcahse a new one.

I hope this helps.
1 vote
Brandy Sutton, Agent, Evans, GA
Thu Feb 10, 2011
HUD homes can be purchased just like any other home on the market. Your best bet is to visit with a mortgage lender to verify the loan type you would qualify for. Most HUD homes need repairs completed in order to qualify for financing but there are rehabilitation loans available with small down payments.
1 vote
I am in CA renting under Sect 8 . Rent here is $1,200 which I pay $475, H/A pays $725. I have been in this home for 13 yrs. The previously house 2 doors down for 8 yrs @ $900 a month. 8X12 =96 months x $900=$86,000. The purchase price was $79,000. I paid enough rent to pay the entire cost of the house, there was enough for taxes and insurance. This landlord got a better deal yet. $1,000x 6yrsx & 1,200 x 7 yrs= $72,000 & $100,800 =$172,800 on this house. This house was part of a business property. The house was totally gutted and redone for $60.000. He asked me to rent at least 5 yrs so they could recover the $60,000. In 13 yrs, they have repaired a small patch on the roof. I paid 3 times over cost of the house AND enough to pay taxes & insurance. $258,800 over 21 years but I am too poor to buy a house. I just bought 2 for other people. They want to sell to developers for $2 million each. I saw a house in Carlton I really like. Deborah Winegar, winegar9av@yahoo.com
Flag Fri May 12, 2017
Bisua183, Home Buyer, Hermiston, OR
Thu Apr 6, 2017
I have question about HUD homes. My household(4), Im working for homecareworker which is $1650 a month before tax, and my husband recieving SSI $640 a month. I have kids. Both annual income is about 27k-28k! Do we qualify for a home cost $300k loan. I will put 20% downpayment. Portland Area!! Thanks
0 votes
Bisua183, Home Buyer, Hermiston, OR
Thu Apr 6, 2017
I have question about HUD homes. My household(4), Im working for homecareworker which is $1650 a month before tax, and my husband recieving SSI $640 a month. I have kids. Both annual income is about 27k-28k! Do we qualify for a home cost $300k loan. I will put 20% downpayment. Portland Area!! Thanks
0 votes
no
Flag Sun Apr 23, 2017
lceddy, Home Buyer, Kent, WA
Sun Apr 5, 2015
Can anyone buy a HUD home, regardless of income?

My Gross income is around $30K annually, but my net income for tax purposes is only around $3K annually, as I have a courier business and it costs to have a car that you drive over 200 miles a day, plus commercial insurance, gas and other necessities. I also will be getting about $650 a month from SSN. I will be 65 soon.

Thank you,

Linda
0 votes
Elvaesparza1, Home Buyer, Sylmar, CA
Sat Mar 21, 2015
To buy a home how much $ down , it's my first time trying to buy a home ...
0 votes
Pamelab9182, Home Buyer, Madras, OR
Mon Jun 16, 2014
What about bad credit and no money down can a person still purchase a home.
0 votes
Ian Gray, , 30014
Sat Aug 31, 2013
Talk to a trusted loan consultant, and let him / her run several scenarios to see what works best for you. No simple answer to this question.
0 votes
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