All You Need to Know about HUD Mortgage Loans

Established in 1965, the U.S. Department of Housing and Urban Development works to promote community development. More commonly known as HUD, the department's mission is simple: Create suitable and affordable housing. HUD encourages home-ownership, and plays a vital role in helping low-income and middle-income families purchase a home.
The U.S. Department of Housing and Urban Development supports a variety of mortgage and housing programs. Through the department, homebuyers can obtain mortgages insured by the Federal Housing Administration (FHA). This allows individuals with lower credit scores to qualify for mortgages at competitive rates, plus pay a cheaper down payment.

In addition to mortgage and community programs, HUD strives to provide inexpensive housing to families in need. Several programs are in place to assist.

The Housing and Urban Development also works with nonprofit organizations and communities throughout the country to provide transitional housing for the homeless.
HUD and the Fair Housing Act The department doesn't only support affordable housing, but also fair housing. The Fair Housing Act prohibits housing discrimination by landlords, real estate agents and mortgage lenders. No one can be denied housing because on their race, color, national origin, religion or sex. Furthermore, landlords and lenders cannot discriminate based on sexual orientation or a handicap. If discrimination occurs, victims can file a complaint with HUD. The department will investigate the claim, and if necessary, prosecute the offender. Housing and Urban Development Educational Programs In addition to mortgage assistance programs that provide affordable housing and fight discrimination, the Housing and Urban Development offers a housing counseling program that educates tenants and homeowners on how to manage properties and their finances.
Although the U.S. Department of Housing and Urban Development is not a real estate agent or a mortgage lender, they do maintain a supply of properties for sale. If a homeowner with an FHA-insured mortgage defaults on his loan, the Federal Housing Administration pays the lender and then transfers the property to HUD. HUD foreclosures are sold like other real estate properties. These properties are appraised and listed at a fair market value. Each state has a listing for HUD homes. Interested buyers can visit HUD.gov and search "homes for sale" in their city or state. There is a bidding process and a period to submit bids. The department typically accepts the highest bid and closes on loans within 30 to 60 days. HUD does not lend funds, thus anyone hoping to purchase HUD foreclosures must secure financing with a mortgage company. All HUD properties are sold "as-is," thus new owners are financially responsible for all repairs and improvements. However, the list price for a property will reflect the present condition of the property and take into account any needed repairs.

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