HUD Secretary Advocates for Lower Down Payments on FHA Mortgages
February 28, 2008
HUD Secretary Alphonso Jackson recently sent a letter to Congress, urging them to approve lower down payments on FHA-insured loans. FHAloanpros.com explains:
“Specifically, Mr. Jackson advocated for, among other things, “flexible down payment options.” HUD clarified “flexible down payment options” to mean cutting in half the current FHA down payment requirement of 3% to 1.5%.”
There’s no guarantee that a bill like this will pass. However, if it does it could make it extremely easy for homebuyers to purchase HUD homes for sale.
See Also: HUD Foreclosure Guide
HUD $100 Downpayment Program in Pennsylvania
February 27, 2008
HUD is currently offering several incentives, including a $100 downpayment program, for bidders in select Pennsylvania counties. Here’s what to look for:
- $100 Down payment financing is available on most properties through FHA approved lenders.
- Sales allowances that can be used to pay closing costs, make repairs, or pay down the mortgage amount.
- Broker bonuses for owner-occupant sales.
In order to qualify for the $100 downpayment incentive, Pennsylvania bidders must be owner-occupants using FHA-insured financing. The incentive programs are available now through September 30, 2008.
See: How to Find HUD Homes for Sale
Ohio HUD Homes: Less Than a Cup of Coffee?
February 26, 2008
In a recent Chicago Sun-Times editorial, Jesse Jackson claims that Ohio HUD homes are drastically underpriced:
“Ohio is also the epicenter of the housing bust. Some 150,000 homes went into foreclosure last year. Across the country, one in 10 homes are “under water” — worth less than their mortgages. That ratio is much worse in Ohio. In Cleveland, there are so many foreclosures that HUD is selling homes for less than the cost of a cup of coffee. You can pay for your tall latte at Starbucks with a $5 bill and use the change to pick up a house from HUD. Responsible homeowners have lost the savings they built in their homes. Communities once more find their tax base decimated. This starts a vicious cycle of cuts in police and schools; vandals sack empty homes; and prices continue to plummet.”
It’s true that prices on Ohio HUD homes for sale are dropping, but don’t start searching for nickels in the couch quite yet. The Ohio HUD database is currently listing only one home at the $1,000 price point. However, there are seventeen Ohio HUD homes available for less than $5,000. At the $10,000 price point, you have dozens to choose from.
HUD Ends Broker “Kickback” Program
February 25, 2008
Last week, HUD announced that the end of their broker incentive program. For the last three months, HUD has been offering $500 bonuses to real estate brokers who convince clients buying HUD foreclosure properties to use FHA financing.
The program came under scrutiny when a Michigan attorney claimed that the incentive program constituted an illegal “kickback”.
Freep.com reports:
“HUD awarded the $500 bonus to about 200 brokers since November, including 67 in Michigan, said HUD spokesman Brian Sullivan.
Under RESPA, anyone who awards kickbacks for referrals can face fines up to $10,000 and a possible 1-year prison sentence, said Sullivan. Often out-of-court settlement agreements are made, he said.”
After ending the old program, HUD announced a new incentive that awards the $500 to real estate brokers who sell a HUD home - regardless of whether or not their client chooses an FHA-insured loan.
HUD Incentive Programs in Michigan
February 25, 2008
HUD is currently running several buyer incentive programs on HUD homes for sale in Michigan. Here are the new offers:
- $100 down payment financing is available on most properties through FHA approved lenders.
- Sales allowances that can be used to pay closing costs, make repairs, or pay down the mortgage amount.
The buyer incentives are available any time before September 30, 2008. In order to qualify for the $100 down payment, buyers must bid as owner-occupants and use FHA financing.
Who is Hooks Van Holm, Inc.?
February 22, 2008
Hooks Van Holm, Inc. is a real estate asset management company contracted by the government to sell HUD homes in the following states:
- Alabama
- Delaware
- Mississippi
- Pennsylvania
Hooks Van Holm, Inc. is the only company that can list HUD homes for sale in these states. However, as a bidder, you may bring your own buyer’s agent into a HUD transaction. You can view the Hooks Van Holm, Inc. database of HUD foreclosure properties on their website: Hooks Van Holm, Inc.
If you’re considering purchasing a HUD property through Hooks Van Holm, these resources can help: HUD Foreclosure Buying Guide, Working with HUD Approved Realtors.
Q: Do I need a low income to purchase a HUD foreclosure home?
February 21, 2008
No. While many HUD foreclosure homes can be purchased at below-market prices, these properties are available to anyone who can afford them. Owner-occupant bidders get the first opportunity to purchase HUD foreclosure homes. If no owner-occupant bid is accepted, the auction is opened up to investors.
20+ Most Common Questions About HUD Homes for Sale
February 20, 2008
Can I make a low-ball bid or barter on a HUD home? Do some HUD homes actually sell for $1? Who pays the HUD agent’s commission?
If you have questions like these, check out the new list of HUD Foreclosure FAQs for Homebuyers. You’ll find answers to over twenty of the most-asked HUD questions.
HUD Asks Congress for Flexibility on FHA Pricing
February 19, 2008
This month, HUD urged Congress to allow them more flexibility when pricing FHA loans. Business Week explains:
“The Department of Housing and Urban Development warned U.S. lawmakers Monday that the Federal Housing Administration could face financial difficulty if Congress limits its ability to charge higher premiums to riskier borrowers.
“FHA will move ever closer toward financial insolvency, given the uncertainty and volatility in today’s mortgage market if forced to continue its current premium structure,” HUD Secretary Alphonso Jackson said in a letter sent Monday.”
HUD wants the freedom to raise rates for risky-borrowers. Congress, on the other hand, says they’re promoting housing availability by limiting the amount FHA borrowers can be charged and keeping down payment minimums low.
If you’re an owner-occupant bidder, securing FHA-insured financing is a smart way to save money (and even take out money for repairs in the case of the 203(k) loan). See: Secrets of HUD Foreclosures.
HUD Homes for Sale in Ohio: $100 Down Payments and Sales Allowances
February 18, 2008
The government is currently running a few incentives on HUD homes for sale in Ohio.
Bidders who purchase a HUD home during the incentive period can qualify for these discounts:
- $100 down payments on HUD Homes financed with FHA-insured financing.
- Sales allowances that can be used to pay closing costs, make repairs, or pay down the mortgage amount.
- Broker bonuses for owner-occupant sales.
Many times HUD incentives require that purchasers bid for the full listing price. Ask your HUD approved agent for details.