Minnesota Hud Homes
HUD Homes for $100 Down Payment
March 10, 2009 by Financemyhome · Leave a Comment
On most FHA loans, a homebuyer would have to put down a 3.5% down payment. Recently, they are now offering loans with 100% financing and only a $100 down payment for owner-occupied homes. So how does the HUD homes for $100 work?
HUD does have special requirements on the $100 down payment hudhomes for sale. All buyers must live in the property for a least one year and the $100 down payment option is not available to investors. The buyer must offer the full asking price of the HUD home and the buyer must use an FHA loan for the purchase of the hudhome. You must also meet the qualifications for an FHA-insured loan.
How Does the Program Work?
On every Friday, HUD lists their foreclosed homes for sale. The first ten days, HUD accepts offers only from owner-occupied buyers. This is called the exclusive listing period. On the eleventh day, HUD can pull the listing to re-price it or open up the bidding to non-owner-occupied buyers. The $100 down payment is good for those owner-occupied interested buyers in that first ten-day timeframe.
First, you can visit your realtor to get pre-qualified for the $100 down payment HUD program. This is a process where you submit personal information to HUD and they will give you pre-approval for the program. Next, you search for a hudhome for sale. Once you decide on a residence, your real estate broker will submit the 100dollarHUDHomes offer to buy. You will be competing with other buyers within the first ten days. One you win the bid, you purchase the hudhome using an FHA insured loan.
Are There Special Requirements?
HUD does have some requirements in order for you to qualify for the $100 down payment hudhome opportunity. They are as follows:
- It must be your primary residence and you must live there for one year.
- You must offer HUD’s full asking price to be considered.
- You must obtain and FHA-insured loan that has either a fixed rate or an adjustable rate and is 30 or 15 years in length.
- Your debt to income ratio must be 31%/43%.
- The maximum amount of the loan cannot exceed $362,790.
- This HUD offer is good on all HUD single-family homes, townhouses, planned unit development homes, and condos.
- You must have a minimum credit score of 580 and if you recently had a bankruptcy, it must have been discharged 24 months prior to your hudhome purchase.
- You must have two years of employment history and FHA mortgage insurance is required for all $100 down payment HUD homes.
How Do I Start?
You can speak with your real estate broker who can tell you what HUD homes are available for sale in your area. You will work with them to get you pre-qualified for the $100 down payment option and obtain an FHA-insured mortgage through a conventional lender, such as your local bank.
The HUD $100 down payment offer will not last forever, so if you are interested in purchasing a foreclosed HUD home, contact your realtor today to get started.
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