FHA is part of HUD, so when you are reading about HUD programs, remember that HUD is actually who now “owns” the FHA Foreclosed Homes. FHA is usually the program that folks who want to buy those foreclosed homes use for their mortgage. (Get’s Confusing) The truth is, there are very FEW of these homes available, but you CAN buy a HUD Foreclosed Home with $100 down payment in NC.
The HUD Home Store is the site you are looking for if you are interested in buying a HUD Foreclosed Home. Because The HUD Home Store might list properties for sale that were originally USDA or VA Loans, we suggest that buyers focus on homes with a FHA Case Number. In NC that would mean a case number that begins with 381 – xxxxxx
HUD Foreclosed Home with $100 Down Payment in NC
HUD Homes with $100 Down Payments: If you are purchasing a HUD foreclosed Home, and you are careful to write it in the contract – HUD will allow you to get a FHA mortgage on that property with a $100 down payment. HUD will also contribute to your closing costs. The buyer must be an owner occupant to qualify, and they must offer full price. You must be willing to live in the property for a year. You CAN combine this program with a FHA 203K, but you MUST write it in the Contract with HUD.
Please be aware that there are 2 different types of FHA 203k Loans. The FULL FHA 203K allows for additions, conversions, structural alterations and pretty much all types of major work under or above $35,000. It requires a FHA Consultant that must be involved in the process. The Streamlined FHA 203k Rehab loan can be used for minor improvements under $35,000 and does not require the help of a 203k consultant.
For the FHA $100 Down Program, be careful when you are looking at the HUD Home Store for these Foreclosed Properties. The FULL 203(k) program may be used only on properties listed Uninsurable (UI). The Streamline FHA 203k Rehab loans can be used on properties listed Insured (IN) or Insured with Escrow (IE).
To get the FHA $100 down payment program approved with HUD you must:
- The Home Buyer has to live in the property for at least one year (Investors do not qualify for this FHA Loan, and I know for a fact this 12 month rule gets checked)
- The Home Buyer has to offer full asking price for the home, and
- The Home Buyer must use a FHA loan for the purchase.
FHA Good Neighbor Next Door: If you are purchasing a HUD Home in a qualifying “Revitalization” area, HUD allows Teachers, Firemen, Police Officers, and qualifying EMT’s to purchase the home at 50% of the asking price. They must be willing to Owner Occupy the home for 3 years – and you can not own residential real estate for 12 months prior to the offer.
How does the 50% off work?
There will be a second mortgage (silent) note payable to HUD, on a home purchased through the Good Neighbor Next Door program in NC. This second mortgage will be equal to 50% of the list price of the home.
It’s offered for the homes that are often in the “less desirable” neighborhoods. Sometimes, however, the home might be in a great location – it just needs a ton of “help” to put it in a livable condition, and because of that, it might be offered by HUD under this 50% off program. Ultimately – HUD wants the homes to be lived in.
Does HUD provide a home warranty?
Find these houses (there are VERY few in NC) at The HUD Home Store. You will find NEW properties that are eligible at the end of every month.
You CAN use the Mortgage Tax Credit and NCHFA Grants to help with Closing Costs on both of these FHA Loan programs. NC Housing will provide a grant up to 3% of the Loan Amount to cover your expenses. The rates are slightly higher, but it’s a great program!
If you have questions about purchasing a HUD Foreclosed Home with $100 down payment in NC or you have questions about getting qualified for a FHA Mortgage Loan, please call Steve Thorne at 919-649-5058. We do many FHA loans, we offer today’s lowest mortgage interest rates, and we can help!