March 31, 2011
The FHA loan program features a variety of loan products for qualifying borrowers to get into affordable housing by applying for a loan with an FHA guaranty. But the FHA doesn’t just guaranty loans, it also offers house hunters the option of purchasing property owned by the Department of Housing and Urban Development, also known as a “HUD home”.
According to the FHA official site, “A HUD home is a 1-to-4 unit residential property acquired by HUD as a result of a foreclosure action on an FHA-insured mortgage. HUD becomes the property owner and offers it for sale to recover the loss on the foreclosure claim.”
HUD homes are available to the public–not just FHA borrowers. Anyone may purchase a HUD home but getting one is a different process than simply house-hunting, applying for an FHA mortgage and closing the sale. The FHA offers HUD homes through an auction process and borrowers need to work with a HUD-approved real estate agent to help place a bid on a property.
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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