What are HUD Homes and are they worth buying

What is a HUD home?

In a nutshell, HUD homes are properties that were foreclosed upon, which were purchased originally with an FHA insured loan. FHA (Federal Housing Administration) is part of HUD (U.S. Department of Housing and Urban Development), so when these homes are foreclosed upon, FHA pays the bank for their loss and in turn, acquires the property. That is how a HUD home is born. FHA is a whole other topic I might write about in the future but for now I will stick to the HUD homes.

HUD Inventory on the Rise

When I went onto HUD’s property listing website, I was pleasantly surprised with the amount and the quality of homes that were available. Ten to fifteen years ago, HUD homes were considered to be those that needed to get lots of work done. The homes were usually boarded up, in terrible condition and in undesirable areas. There wasn’t much of an inventory to even bother with, nor to get certified to make offers on. With receding family incomes, more people that purchased homes with FHA financing are finding themselves unable to keep those homes. This is why more HUD homes are coming to the market.

There are great deals on HUD properties and some a new construction.