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HUD Homes: The Basics

by Jonathan Maines 03/06/2022


If you're searching for a new home, you may have come across references to Housing and Urban Development (HUD) homes. HUD offers government mortgage insurance programs and loans. But what is a HUD home, exactly?

Here are the basics to help you with your home search:

HUD Homes: The Basics

HUD homes are foreclosed properties reclaimed by the government. When a buyer uses a Federal Housing Administration (FHA) loan to buy a residential property, they risk losing the property entirely if they cannot make their mortgage payments. The government then re-sells the homes at a low price to make up for the money spent paying off the rest of the mortgage.

Every HUD house gets an appraisal to determine the best price, but they are still often below market value. This makes them attractive options for first-time homebuyers, flippers or anybody looking for a good deal.

Incentives to Buy HUD Homes

The HUD agency offers many incentives to homebuyers to encourage the sale of these foreclosed properties. These incentives include grants, vouchers and special buyer programs to assist with mortgage payments, down payments and more. Buyers with careers in public service or who work with nonprofit organizations are also eligible for some of these special incentives.

Buying a HUD Home

It's important to note that the process for buying a HUD home differs from other homes. You won't find listings for these properties in the usual places like MLS or search portal sites. Instead, you can search and browse HUD listings on their website.

HUD homes are different from other properties in that you have to buy them at auction. You need a licensed real estate agent to represent you, to bid on and purchase a property.

Is a HUD property right for you? There are many factors to consider, but knowing the basics will help you make your decision. Consult a real estate professional for advice on the best way to proceed with your home search.

About the Author
Author

Jonathan Maines

After graduating from the University of Wisconsin- Eau Claire, Jon moved to Naples, Florida in 1989 where he took a job with the Naples Police Department. In 1991 Jon married his wife Kathy, also from Wisconsin, and had two children. During the next 19 years Jon continued to work for the Naples Police Department ultimately becoming a Lieutenant. During this time he and Kathy also became successful real estate investors. In June 2010 Jon retired from the Naples Police Department to focus his energies into being a successful Real Estate Professional. Jon believes that his faith, honesty, integrity, knowledge and hard work have been the key principals to his success in the Real Estate Business. If you are looking for an agent you can count on and trust to give you an honest perspective when looking to buy or sell your home, Jon is here to serve you. Call today for a free market analysis!