HUD stands for the Department of Housing and Urban Development. It is a federal government agency. FHA stands for the Federal Housing Administration.
FHA usually refers to a type of loan insured by the FHA. The basic requirements are that the buyer put at least 3% down. Closing costs generally run 2.5-3% but may be more, depending on your credit rating and other factors. So altogether, the buyer would have to have approximately 5.5-6% of the purchase price as a down payment. However, if you make an offer on a home you can ask the seller to pay some closing costs on your behalf. You still have to pay at least 3%.
HUD houses (if that's what you are asking about) are homes where the owners didn't make their payments and the homes were foreclosed on. HUD has a website where you can find out about this type of home. http://www.hud.gov. In order to make a bid on this type of home you need to have the help of a real estate agent who is registered with HUD. You would have to arrange your own financing with a lender and be pre-approved before you make the offer.
In any case, I would recommend that you get a good buyer agent (a real estate agent who specializes in working with buyers). In most parts of the country there is no extra cost to you, but you may have to pay a fee for this. However, it is probably worth it, because your agent can guide you through the transaction, help you find homes, and protect your interests. Your agent may also be able to recommend lenders to help you get pre-qualified or pre-approved for a loan.
I am a licensed realtor in Arkansas.
· 1 decade ago