Detroit Metro HUD Homes Brokers

HUD NEWS, CHANGES and PROGRAMS

Your HUD Home can be Your Dream Home

If you are thinking about buying a REO property that needs repair, FHA’s 203(K) rehabilitation loan or it’s simplified alternative, the Streamlined(k) may be a good option for you. FHA’s simplified Streamlined(k) program for small-scale repairs is the perfect option for most HUD REO sales. For the major repairs & more complicated renovation plans, the Standard 203(K) program is the option.

HUD Homes, like the majority of property re-sales, require some level of repair. FHA’s Streamlined (k) program allows the buyer to finance both the purchase and the cost of minor repairs and/or upgrades through a single mortgage. While there is no cap on repairs for the Standard 203(K), the Streamlined (k) allows for repairs from $1 up to $35,000.

For the Streamlined (k) option, homebuyers identify their repair needs, which may include: new carpet; interior and exterior paint; new appliances; kitchen or bathroom remodel; exterior landscaping and other minor improvements.

A FHA approved lender will be able to answer specific questions about the Standard and Streamlined 203(K) loan program. To find out more, visit HUD’s website at www.hud.gov/offices/hsg/sfh/203k/203kslrp.cfm or call 1-800-CALLFHA.
Good Neighbor Next Door Program - HUD has revised regulations governing the Officer Next Door / Teacher Next Door / Firefighter/EMT Next Door Special Sales Programs. These Programs are now known collectively as the Good Neighbor Next Door Program. Please submit a request form for an overview and references to these Special Programs.

CLOSING COST IMPLEMENTATION
Please be advised that HUD’s new closing cost policy took effect in October 2006. Your contract can not contain a request for more than 3% closing assistance, reduced maximum closing costs to 3%. NO EXCEPTIONS

NEW CLOSING COSTS GUIDELINES
Effective Oct. 12th, 2006 - For all contracts executed on or after October 12th, HUD will pay up to an amount equal to 3% of the purchase price for purchaser financing and closing costs considered to be reasonable and customary in the jurisdiction where the property is located. If the total closing costs reflected on the HUD 1 settlement statement are less than the amount indicated on the sales contract, HUD will reimburse only the actual costs charged and will not credit the purchaser with any difference either in cash or through a reduced purchase price. Within the three percent (3%) allowance, HUD will reimburse loan origination fees up to one percent of the mortgage. However, on an FHA 203(k) rehabilitation mortgage loan, HUD will reimburse one and a half percent (1.5%) of the mortgage. NOTE: If the purchaser is requesting HUD paid closing cost assistance, the amount must be entered on line 5 of the bid submission form at the time the bid is submitted. Adding an amount to the purchase agreement after submission of the bid is not allowed. Please review HUD Housing Notice H-2006-12

NEW LOTTERY for Disaster Evacuee's
HUD has announced a Nationwide Sale of Properties to Disaster Evacuees of Katrina, Wilma and Rita through its new Lottery System. Properties not previously listed that are eligible for FHA financing will be added to MCB's weekly Lottery and Evacuees with FEMA certification (FEMA Registration Number) who are eligible for disaster assistance will receive a 10% discount. Buyers have a choice to utilize two funding options - FHA Financing or Cash, to receive the discount. This includes the 203(h) mortgage for Disaster Evacuees or 203(k) including the streamline 203 (k). This discount is limited to properties bought through the lottery program only. Purchasers have to utilize the services of a HUD-registered real estate broker to which HUD will pay a sales commission up to 5% of the purchase price. HUD will also pay all of the buyer’s reasonable and customary closing costs up to 5% of the purchase price. Earnest money for contracts resulting from this lottery offering will be $500 for disaster evacuees. Buyers will be required to live in the properties as owner/occupants for at least one year from the date of purchase.

For more information please click here and look under FAQs.