12-29-2012 02:06 PM
From what I was told by a LO the other day, if you want a HUD home then an FHA loan is pretty much out of the question as he said most HUD home sellers want the closing done ASAP and will not wait 30-45 days for an FHA loan to be processed....this didn't sound right to me.
I guess it could be a case by case basis, but I do not see what the problem would be.
However, with HUD homes, does HUD contribute to the closing costs like a normal seller would in a traditional sale?
12-29-2012 02:41 PM - edited 12-29-2012 02:42 PM
A HUD home is essentially a HUD REO property (a property that had an FHA loan on it that was foreclosed by the lender).
FHA will finance HUD homes. It could be that either your lender has a guideline where they won't finance HUD homes with FHA financing. Or your LO may be leery or what is the most common reason, your lender won't do a 203k type loan (the FHA rehab loan). Not many lenders do the 203k loans as they are more paperwork intensive and time intensive. Many of the HUD homes require rehab loans.
Have you only talked with the one LO or have you spoken to several? You might be better off working through a mortgage banker that specializes in 203k loans and the world of HUD homes will open up to you.
(Do a search for *FHA financing for HUD homes* and you will get a better explanation of the various types of financing available for HUD homes and FHA financing)
12-29-2012 05:02 PM
HUD does contribute to closing.
We purchased a HUD home with FHA, went fine. Our lender would not even consider trying a rehab loan, so the HUD homes that needed that we didn't look at.
01-22-2013 08:26 AM
I also bought a HUD owned home using FHA. Mine was also an FHA foreclosure. FHA/HUD even provided an incentive to use an FHA loan with a $100 downpayment offer. This was just last Feb so not back in the crazy loan days.
Forums posts are not provided or commissioned by FICO. Forums posts have not been reviewed, approved or otherwise endorsed by FICO. It is not FICO's responsibility to ensure all posts and/or questions are answered.Advertiser Disclosure: The listings that appear on myFICO are from companies from which myFICO receives compensation, which may impact how and where products appear on myFICO (including, for example, the order in which they appear). myFICO does not review or include all companies or all available products.
IMPORTANT INFORMATION: All FICO® Score products made available on myFICO.com include a FICO® Score 8, along with additional FICO® Score versions. Your lender or insurer may use a different FICO® Score than the versions you receive from myFICO, or another type of credit score altogether. Learn more
FICO, myFICO, Score Watch, The score lenders use, and The Score That Matters are trademarks or registered trademarks of Fair Isaac Corporation. Equifax Credit Report is a trademark of Equifax, Inc. and its affiliated companies. Many factors affect your FICO Score and the interest rates you may receive. Fair Isaac is not a credit repair organization as defined under federal or state law, including the Credit Repair Organizations Act. Fair Isaac does not provide "credit repair" services or advice or assistance regarding "rebuilding" or "improving" your credit record, credit history or credit rating. FTC's website on credit.