HUD Programs & Incentives

HUD Homes Sales Incentives

FHA is, for a limited time, offering sales incentives on HUD Homes to make them more affordable for homeowners purchasing a property using FHA-insured financing

The incentives vary depending on the state but may include:

-low down payments
-sales allowances that can be used to pay closing costs
-pay down the mortgage amount
-broker bonuses for owner-occupant sales.

The benefits of an FHA financing include low down payments, competitive interest rates, and flexible credit qualifying.

Good Neighbor Next Door (GNND)

For law enforcement officers  pre-K through 12th grade teachers, and firefighters/EMTs, HUD offers a substantial incentive of a 50% discount of the listing price of the home.  In return, qualified applicants must commit to living in the home as the primary residence for 36 months.  When a qualified applicant chooses a FHA-insured mortgage, the down payment is only $100.  Eligible single family homes located in designated revitalization areas are listed exclusively for sales through the GNND program.  GNND buyers can bid in lottery, exclusive, and extended phases but can only bid on insured single family unit homes in revitalization areas during the lottery phase.  HUD requires that you sign a second mortgage and note for the discount amount which will accrue no interest and require no payments as long as the three-year occupancy requirement is fulfilled.

$1 Home Sales

HUD’s Dollar Homes Initiative allows local governments the chance to purchase certain HUD-owned homes that have been for sale for an extended period of time for $1.  These homes can be used for low to moderate income families and to address specific community needs.  Dollar Homes are single-family homes acquired through the FHA in a foreclosure.  Dollar Homes are made available after the FHA is unable to sell the home for six months.  By selling the homes for $1 HUD makes it possible for the community to fix up the homes and utilize them for a good cause at considerable savings.  These homes can act as catalysts for neighborhood revitalization through attracting residents and businesses to an area.  Local governments can partner with local nonprofit organizations to resell the homes to low and moderate income residents in the community.

Nonprofit Organizations

Eligible nonprofit organizations can bid during the lottery, exclusive, and extended phases if they are in approved purchase areas.  In the lottery phase, the property must be uninsured.  Government agencies are higher priority in the bid selection for the lottery but Nonprofits are higher priority for exclusive and extended listings.

FHA’s “First Look” Sales Program- Neighborhood Stabilization Program

The First Look Initiative is the collaboration of two programs to accelerate the effort to combat property abandonment in communities that are struggling to overcome the foreclosure crisis.  Government entities  nonprofit organizations, and sub-recipients that have a HUD-issued Name and Address Identification Number (NAID) qualify for the First Look Sales Method.  HUD’s Neighborhood Stabilization Program was created to address the housing crisis, create jobs, and grow local economies through providing communities with resources to purchase and rehabilitate vacant homes.  NSP grants help state and local governments and nonprofit developers acquire land and property, demolish or rehabilitate abandoned properties, and/or offer down payment and closing cost assistance to low and middle income home buyers.   They can also stabilize neighborhoods by creating “land banks” to assemble  temporarily, manage, and dispose of foreclosed homes.  The National First Look Program is a public-private partnership between HUD and the National Community Stabilization Trust to give communities participating in HUD’s Neighborhood Stabilization Program an exclusive opportunity to purchase bank-owned properties in certain neighborhoods so that the homes can be rehabilitated, rented, resold, or demolished.  The First Look Sales Method gives NSP grantees a preference to acquire HUD properties within the NSP-designated area as well as purchase the properties at a 10% discount bellow the appraised value.  The FHA-NSP First Look period lasts approximately 14 days from the conveyance of a property to FHA.  Properties that remain unpurchased at the end of the First Look period will be listed and sold following standard FHA procedures.  Eligible NSP grantees can purchase these properties with the assistance of NSP funds for any eligible use under NSP, including rental or homeownership.  This program will last through May 31, 2013.

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