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Buying HUD Home | Can You Buy A Hud
Home?
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You may have many questions about if you can buy a HUD Home or even if buying HUD home is the right thing for you to do. You will learn how to buy a HUD home! Who can buy a HUD home for sale? Do you have to be a first time homebuyer? Can you get a HUD home financed or do you have to pay cash? Is buying a HUD home difficult?
Those are some the common questions about buying HUD homes. Truth is that buying HUD home is for almost everyone. Any individual who can qualify for a mortgage or who can pay cash may buy a HUD Home. If you do buy a HUD home for sale as an owner-occupant then you have to live in it for at least one year and you cannot participate in future HUD homes sales for 2 years after purchase. Of course, these restrictions does not apply to investors and investors are not limited on how many HUD homes they can buy. Another good thing about buying HUD homes is the HUD $100 Down Payment Incentive Program were you can purchased a HUD foreclosed home with only a $100 down payment. The normal down payment for a FHA Home Loan is 3.5%. You can get more information on this great program by going to HUD $100 Down Payment Incentive Program.
How To Buy A HUD Home?
Nowadays it is almost impossible to make an offer on any house without a pre-approved letter. Some real estate agents will not even show your homes without you getting pre-approved first. In the past I would show homes without a client getting pre-approved but now I will want my clients to contact a lender first. Getting pre-approved first will save you and your agent time because you will know when you see a home you like that you will be able to get a mortgage for it. HUD will not accept any bids on HUD homes for sale without a pre-approved letter!
Pre-Approval Letter Requirements
HUD has certain requirements for pre-approval letter such as: 1. The letter must be on bank letterhead. 2. It must be signed by the loan officer. 3. It must list the exact names of the buyers as shown on the contract. If you use a middle initial on the contract then you will have to use a middle initial on the pre-approval letter. 4. It has to show the correct loan amount. 5. Need to list the type of loan such as 203B, 203B with escrow, or 203K. 6. The repair escrow only applies if you are going to use FHA financing. 7. Must state that credit has been reviewed. 8. It must be dated in the last 30 days.
The Two Different Types Of Buyers For HUD Homes
HUD divides buyers into two groups, owner-occupants and investors. Owner-occupants have the initial advantage over investors. Priority is given to purchasers who are owner-occupants for the first thirty calendar days after a new listing is posted. Also, owner-occupants must live in the house as their primary residence for at least one year and may not purchase another HUD home for two years. HUD does not provide financing for the purchase of HUD Homes. It is up to the buyer to locate the financing through a bank or mortgage company. Before you bid on a property, be sure you have secured financing. If you place winning bid and you cannot obtain financing within the specified time, you may lose the earnest money deposit that you submitted with your offer. If the property you want to purchase needs repairs, you can get a FHA Loan called Streamlined FHA 203K Loan. You can include up to $35,000 of non-structural repairs in the loan. You can get more information on this loan by clicking Streamlined FHA 203K Loan. So, if you have the money or can qualify for loan, you can buy HUD Homes. Buying HUD home is one way to take advantage of the great deals on all of the foreclosures that are available in today's market!
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