HUD homes for sale in Cincinnati

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CincinnatiHud.com Search here! Your Link to purchasing HUD Homes for sale in Cincinnati

Welcome. We established this website for the sole purpose of assisting you. While there are all types of foreclosure property available now throughout Ohio, some of the best deals anywhere are from HUD - The United State Department of Housing and Urban Development. CincinnatiHud.com is here just to assist you the homebuyer or investor in buying a HUD Home for sale in the Cincinnati area. Scroll down for links and information about every aspect of buying HUD property and other information about HUD and other government auction websites*.

Click on “Search for HUD homes here” , to find the home for you then call us at 513-721-LAND or email us info@cincyland.com to place your bid. More good news: You do not pay us - HUD pays us!

Read at least the first 3 pages of instructions to understand the basic procedures HUD has for buying HUD homes in Cincinnati. You must have earnest money and your financing in place before making a bid**. Call or email us if you need information on where to find lenders or other home buying assistance (try “The Home Ownership Center” www.hometoday.cc, for possible grants). We will also assist you with buying a HUD home for sale in Butler County Ohio, a HUD home for sale in Warren County Ohio, a HUD home for sale in Clermont County Ohio and of course a HUD home for sale in Hamilton County Ohio.

HOW TO BUY A HUD HOME IN CINCINNATI

Department of Housing and Urban Development (HUD) residential foreclosures are available in Cincinnati as well as throughout the United States. The sales process for purchasing a HUD home in Cincinnati is a little different from buying a home from an individual, so read our guide and call or email us with any questions:

What exactly is a "HUD Home"?
A HUD Home is a property that was previously financed with an FHA insured mortgage and where the owner has defaulted on the loan. The lender, then, forecloses on the home. FHA pays the lender what is owed; and the lender transfers ownership of the home to FHA/HUD. Then, HUD tries to sell it at market value. Single family and some multi-family properties are sold by HUD.

Can anyone buy a HUD Home in Cincinnati?
Anyone who has the cash or can qualify for a mortgage can buy a HUD Home.

Is it true I can get a HUD Home in Cincinnati for a dollar?
No, but maybe. Generally HUD sells homes at market value or as close as they can get to it, depending on demand. That means that the price is set based on the price of similar homes sold in the area. From time to time some “dollar” programs do take place, usually for a very distressed property and we are not aware of any such programs right now, but check out the Good Neighbor Program - In an effort to expand its partnership with local governments in helping to foster housing opportunities for low to moderate income families and address specific community needs, HUD is introducing its Good Neighbor Program. This program facilitates the sale of aged HUD inventory of single family homes to local governments for ONE DOLLAR ($1.00).TO LEARN MORE ABOUT THE $1 HOME SALE PROGRAM, click on the link below:
http://www.hud.gov/offices/hsg/sfh/reo/goodn/dhmabout.cfm

If the HUD Home needs repairs will HUD make them?
HUD Homes are sold "as-is," without warranty. That means that HUD will not pay to correct any problems. You must rely on your own inspections and buyers are encouraged to get the home professionally inspected. Houses built before 1978 may have lead based paint, which can cause harm to your family; so be sure to read about this hazard and about what you would need to do to correct it.

How do I buy a HUD in Cincinnati home?
HUD Homes are sold through us and other participating real estate Agents.
We can submit your bid for you. All real estate agents’ commissions are paid by HUD but it does come off the bottom line HUD looks at when considering your offer.

How do I find HUD Homes for sale in Cincinnati?
Right here! HUD Homes for Sale http://hud1.towerauction.net/OH.htm, The list of HUD Homes for sale is updated daily. If you see one that interests you, let us know right away and we can help you from there.

How do I get a loan to buy a HUD Home in Cincinnati?
HUD does not make loans. You must contact a HUD approved lender, who will take you through the steps and actually make the loan. http://www.hud.gov/ll/code/llslcrit.cfm, - this is the link to the HUD page for approved lenders.

Can I buy a HUD Home as an investment?
Yes, however some HUD Homes are initially offered on a priority basis to owner occupant purchasers (people who are buying the home as their primary residence). Following the priority period, unsold properties are then available to all buyers, including investors.

HUD also has a special sales program under which approved Officers and Teachers (as defined by HUD) may purchase properties at discounted prices in revitalization areas.

When you purchase a HUD home for sale in Cincinnati you will need to use and execute HUDS Forms. Make sure and read all forms carefully and ask questions if you do not understand. Legal advice is easily available from real estate attorneys. It’s no big deal to call one for form or contract review. We can steer you in the right direction. As Realtors we can not give legal advice. We are however familiar with the HUD forms.
The HUD forms include (here is the link to open all HUD forms:
Sales Documents:
The HUD Sales Contract

The HUD Sales Contract Checklist for Agents

The HUD Complete Sales Contract Package

The HUD Sales Contract Electronic Filing Addendum 9548

First we submit your offer on-line. If accepted all original documents must be sent in within 48 hours, so be ready to move forward quickly. Have your earnest money and any financing in place. We can help you find good lenders if you have not yet taken that crucial step. More than ever you must have any financing in place before you place an offer with HUD as HUD has very inflexible deadlines. You may face extension fees and possibly losing your earnest money if you do not meet HUD’s deadlines - so be prepared – we can help.
If your offer is rejected we will be notified by email and it will be posted on-line. HUD does not make counter-offers. Preference is given on some properties for owner occupied status over an investor. HUD frequently has the best deals on the market. If you do not mind doing a little work and dealing with less history of the property (there is no seller who has lived there to fill out disclosures or tell about the property) you can end up with an excellent investment.
Addendums:
The HUD Inspection Addendum to Sales Contract

The HUD Land Use Restriction Addendum

The HUD Notice to Purchaser Addendum

The HUD Owner Occupant Certification

The HUD Electronic Filing Addendum

The HUD $1 Home Sales Addendum

The HUD LBP Addendum - Seller has Records

The HUD LBP Addendum - Seller has NO Records

The HUD Addendum to Change Financing

The HUD Addendum to Add Purchaser

The HUD Addendum to Remove Purchaser

The HUD Earnest Money Forfeiture/Extension Policy

Good Neighbor Next Door (GNND) Forms:
The HUD GNND Form for Firefighter and Emergency Responder

The HUD GNND Form for Officer Only

The HUD GNND Form for Teacher Only

The HUD GNND Form 9549-E (Verification of Employment)

The HUD GNND Form 9549-D (Personal Info. Questionnaire)

Now is an excellent time to buy a HUD home in the Cincinnati area. Some multi-family properties may also be available through HUD.

All sales packages must include a copy of:

Agency Disclosure Form (From us)
Copy of Earnest Money Deposit (in the form of Certified Check or Money Order)*
Verification of funds for cash sales**
Pre-qualification from your lender**
HUD may have minimum required earnest money deposit amounts varying by property and asking price. The longer a HUD home is on the market the more HUD lowers the price and accepts lower offers. Make sure and do your own complete inspections as there is no seller history available on HUD homes for sale in Cincinnati.

Additional Forms:
The HUD Allowable Closing Costs

The HUD For Your Protection: Get a Home Inspection

The HUD Purchaser’s Rights and Responsibilities

The HUD Broker’s Guide to Selling HUD Homes

The HUD Bid Cancellation Request BEFORE Acceptance

The HUD Bid Cancellation Request AFTER Acceptance

The HUD Lead Based Paint Disclosure - Transition Properties ONLY

The HUD Utility Activation Request Form

The HUD Streamline (K) Limited Repair

The HUD Assignment of Sales Contract

The HUD Extension Request Form

The HUD Forfeiture of Earnest Money Policy

The HUD Contract Release and Earnest Money Refund Request

The HUD Radon Gas and Mold Notice and Release Agreement

The HUD Agreement to Abide by HUD's Earnest Money Forfeiture Policy

Go to this link for information on HUD settlement costs:

http://www.hud.gov/offices/hsg/sfh/res/sfhrestc.cfm

Additional Websites:

Fanniemae.com http://www.fanniemae.com/index.jhtml - They provide financial products and services that make it possible for low, moderate and middle-income families to buy homes of their own.

Freddiemac.com http://www.freddiemac.com/ - Freddie Mac is a stockholder-owned corporation chartered by Congress to increase the supply of funds that mortgage lenders, such as commercial banks, mortgage bankers, savings institutions and credit unions, can make available to homebuyers and multifamily investors.

*VA Homes http://www.ocwen.com/reo/residential/reoproplist.cfm?statechosen=OH Veterans Administration Homes for Sale (also listed on MLS)

*USA General Services Administration http://auctionrp.com/, The Office of Real Property Disposal of the U.S. General Services Administration (GSA) online auction site of surplus Federal property.

*USA General Services Administration http://gsaauctions.gov/gsaauctions/gsaauctions/ - This is their site for personal property sales – gadgets, vehicles, stuff etc….

*Hamilton County Foreclosures – The Sheriff’s Property Sales http://www.hcso.org/PublicServices/ExecutionSales/ExecPropertySalesDisclaimer.aspx All local foreclosure sales are processed through this office.

The Cincinnati Court Index Press http://www.courtindex.com/ Track all legal announcements including foreclosures.

Cincinnati Community Development and Planning http://www.cincinnati-oh.gov/cdap/pages/-17896-/, City of Cincinnati Housing Links

Ohio Division of Unclaimed Funds http://www.com.state.oh.us/unfd/treasurehunt.asp – Find your old abandoned stock or bank account or health insurance premium or ??? It works – I myself found money there once long lost

HUD's mission is to increase homeownership, support community development and increase access to affordable housing free from discrimination. To fulfill this mission, HUD will embrace high standards of ethics, management and accountability and forge new partnerships--particularly with faith-based and community organizations--that leverage resources and improve HUD's ability to be effective on the community level

History of HUD
1937
U.S. Housing Act of 1937

1965
Department of Housing and Urban Development Act of 1965 creates HUD as Cabinet-level agency.

1966
Robert C. Weaver becomes the first HUD Secretary, January 18.

1968
Riots in major cities follow assassination of Dr. Martin Luther King Jr. Civil Rights Act of 1968 (also known as the Fair Housing Act) outlaws most housing discrimination, gives HUD enforcement responsibility. Housing Act of 1968 establishes Government National Mortgage Association (Ginnie Mae) to expand availability of mortgage funds for moderate income families using government guaranteed mortgage-backed securities.

1969
Robert C. Wood receives recess appointment as HUD Secretary, January 7. George C. Romney is appointed HUD Secretary by President Richard M. Nixon, January 22.

1970
Housing and Urban Development Act of 1970 introduces Federal Experimental Housing Allowance Program and Community Development Corporation.

1972
Pruitt-Igoe public housing buildings in St. Louis are demolished.

1973
President Nixon declares moratorium on housing and community development assistance. James T. Lynn becomes HUD Secretary, February 2.

1974
Housing and Community Development Act consolidates programs into Community Development Block Grant (CDBG) program. Section 8 tenant-based certificates increase low-income tenants' choice of housing. Gerald R. Ford becomes president following Nixon's resignation.

1975
Carla A. Hills is appointed HUD Secretary, March 10.

1977
Patricia R. Harris is appointed HUD Secretary by President James E. Carter, January 23. Urban Development Action Grants (UDAG) give distressed communities funds for residential or nonresidential use.

1979
Moon Landrieu becomes HUD Secretary, September 24. Inflation hits 19 percent, seriously impacting homebuying and home mortgage loans.

1980
Depository Institutions' Deregulation and Monetary Control Act of 1980 changes rules governing thrift institutions, expands alternative mortgages.

1981
Samuel R. Pierce Jr. is appointed HUD Secretary by President Ronald W. Reagan, January 23. Interest rates for FHA-insured mortgages peak at 15.17 percent (up from 7 percent in 1972).

1983
Housing and Urban-Rural Recovery Act of 1983 begins Housing Development Action Grant and Rental Rehabilitation programs.

1987
Stewart B. McKinney Act sets up programs to help communities deal with homelessness.

1988
Indian Housing Act gives HUD new responsibilities for housing needs of Native Americans and Alaskan Indians. Housing and Community Development Act allows sale of public housing to resident management corporations. Fair Housing Amendments Act makes it easier for victims of discrimination to sue, stiffens penalties for offenders.

1989
Jack F. Kemp is appointed HUD Secretary by President George H. W. Bush, February 13. Financial Institutions' Reform, Recovery, and Enforcement Act bails out failing thrift institutions.

1990
Cranston-Gonzalez National Affordable Housing Act emphasizes homeownership and tenant-based assistance, launches HOME housing block grant. Low-Income Housing Preservation and Residential Homeownership Act of 1990 fortifies Federal commitment to preservation of -assisted low-income, multifamily housing.

1992
Federal Housing Enterprises' Financial Safety and Soundness Act of 1992 creates HUD Office of Federal Housing Enterprise Oversight to provide public oversight of FNMA and Federal Home Loan Mortgage Corporation (Freddie Mac).

1993
Henry G. Cisneros is named Secretary of HUD by President William J. Clinton, January 22. Empowerment Zone and Enterprise Community program becomes law as part of the Omnibus Budget Reconciliation Act of 1993.

1995
"Blueprint for Reinvention of HUD" proposes sweeping changes in public housing reform and FHA, consolidation of other programs into three block grants.

1996
Homeownership totals 66.3 million American households, the largest number ever.

1997
Andrew M. Cuomo is named by President Clinton to be Secretary of Housing and Urban Development, the first appointment ever from within the Department.

1998
HUD opens Enforcement Center to take action against HUD-assisted multifamily property owners and other HUD fund recipients who violate laws and regulations. Congress approves Public Housing reforms to reduce segregation by race and income, encourage and reward work, bring more working families into public housing, and increase the availability of subsidized housing for very poor families.

2000
America's homeownership rate reaches a new record-high of 67.7 percent in the third quarter of 2000. A total of 71.6 million American families own their homes - more than at any time in American history.

2001
Mel Martinez, named by President George W. Bush to be Secretary of Housing and Urban Development, is unanimously confirmed by the U.S. Senate on January 23, 2001.

2004
Alphonso Jackson, named by President George W. Bush to be Secretary of Housing and Urban Development, is unanimously confirmed by the U.S. Senate on March 31, 2004. Mr. Jackson is the first Deputy Secretary to subsequently be named Secretary.

U.S. Department of Housing and Urban Development
451 7th Street S.W., Washington, DC 20410
Telephone: (202) 708-1112 TTY: (202) 708-1455

How HUD Became More Effective

The Department of Housing and Urban Development is now rated "results demonstrated." GAO's removal of two of HUD's critical housing programs from its High Risk list marks the first time since 1994 that no HUD programs have been on GAO's list.

The Department has made significant strides to reform the Federal Housing Administration's single-family mortgage insurance programs, improving its lending, appraisal and property disposition controls, and enhancements to the timeliness, sophistication and predictive accuracy of its actuarial modeling. In addition, to reduce improper rental assistance payments, HUD's Office of Public and Indian Housing and Office of Housing improved program guidance, training and automated systems support. HUD developed and implemented the Enterprise Income Verification System (EIV) - a web-based, state of the art system - to share income data in other federal databases with public housing authorities to improve their income verification process. These collective actions led to a 60 percent decline in gross improper payments between 2001 and 2005. The money that had been paid in error is now being used to house more low-income families. All of these accomplishments led HUD to green status on financial management, a clean audit opinion with no material weaknesses, and successful attainment of the goals of HUD's Management and Performance Initiative.

Department leadership established clear goals, a detailed, reasonably aggressive action plan, and clear accountability, and they made it very clear that business process improvement was a priority. With these four keys in place HUD employees successfully took their agency to a heretofore unthinkable level of proficiency, for the benefit of their customers, the taxpayers and HUD employees.

HUD wants mortgage costs made clear to borrowers WASHINGTON (AP) —

Mortgage lenders would be required to give better estimates of closing costs and improve disclosure of payments to mortgage brokers under rules proposed Friday by the President Bush and the Department of Housing and Urban Development.

The new rules would require closing costs to be clearly laid out so consumers can shop for the best loan, and put limits on the changes allowed in that estimate, the department said.

The better disclosures would help consumers save an average $670 in closing costs, said Kurt Usowski, a top HUD economist.

It's the latest in a series of White House initiatives to help end a housing market crisis that has stalled the U.S. economy and sparked global financial market turmoil.

"These mortgage agreements can be pretty frightening to people," Bush said in a speech on the economy. "There's a lot of tiny print. ... One thing is for certain: There needs to be complete transparency."

The proposed overhaul to a 1974 law requiring lenders to give what's called a "good faith estimate" is aimed at making it simpler for consumers when they buy a house or refinance a mortgage.

The proposal is a toned-down version of changes that HUD proposed in 2002 but dropped two years later because of furious opposition from mortgage brokers and some lawmakers.

Record-high foreclosures are aggravating problems in the housing market and for the national economy, which many fear is on the verge of a recession or in one already.

"A lot of the mortgage problems we see today are directly related to the fact that few people understand (the mortgage lending) process," Alphonso Jackson, secretary of the Department of Housing and Urban Development, said in announcing the proposal.

The mortgage broker industry is expected to oppose the proposal because it also calls for lenders' payments to brokers, known as yield-spread premiums, to be disclosed to borrowers.

Brokers receive the premiums for steering customers toward certain lenders although consumer advocates argue that the practice prevents consumers from getting the most competitive interest rate and loan terms on mortgages.

About 12.5 million Americans buy or refinance a home each year. HUD's proposed revision to the 34-year-old Real Estate Settlement Procedures Act would mandate a federal disclosure form be given to consumers who refinance a mortgage or borrow to buy a home.

The form is simpler than private-industry disclosure forms, which can vary widely by state. It includes a summary of loan terms, interest rate and monthly payment, whether the interest rate and principal balance can increase and by how much, whether the loan has a prepayment penalty or balloon payment, settlement costs and other details.

HUD tested the proposed form over several years, which allowed consumers in nearly every instance to better compare home loan terms offered by different lenders, agency officials said.

"Buying a home can be very intimidating. Consumers have had no assurance that the loan terms and closing costs they are offered will reflect what they confront at the settlement table, and that's been one of the factors driving the current housing downturn. Our proposal fixes that," Jackson's statement said.

In a speech to the National Community Reinvestment Coalition's annual meeting.Friday, Federal Reserve Chairman Ben Bernanke said the Fed is "strongly committed to fully employing our authority, expertise and resources" to help homeowners who are in distress.

Earlier this month, Bernanke urged lenders to help distressed homeowners by lowering the amount of their loans. At the time, Bernanke suggested such a longer-term permanent solution may work better than shorter-term and temporary ones, where the distressed homeowner could find himself in trouble again.

To date, permanent home mortgage modifications that have occurred have typically involved a reduction in the interest rate, while reductions of the principal balance of the loan have been quite rare, he said.

On Thursday Treasury Secretary Henry Paulson proposed regulating mortgage lenders more strictly, all part of a broad federal effort to encourage recovery in the beleaguered housing market.

Paulson's proposal covers regulations for mortgage lenders and other financial institutions as well as investors, regulators and Wall Street credit-rating agencies.

Bernanke didn't offer new recommendations Friday, but rather spoke of the various steps the Fed already is taking to address current problems and to prevent another crisis of this sort.

The Fed, for instance, has proposed a rule to protect home buyers from some of the same dubious lending practices that contributed to the housing and credit debacles now shaking the country. Subprime borrowers — those with tarnished credit histories or low incomes — have been hurt most, although problems have spread to more creditworthy borrowers.

"Far too much of the lending in recent years was neither responsible nor prudent," Bernanke said. "The terms of some subprime mortgages permitted home buyers and investors to purchase properties beyond their means, often with little or no equity," he added. "In addition, abusive, unfair or deceptive lending practices led some borrowers into mortgages that they would not have chosen knowingly."

The meltdown in the housing and credit markets are not only straining homeowners but also have forced financial companies to rack up multibillion losses. The situation has unhinged Wall Street, put the Federal Reserve and the Bush administration in crisis-management mode, rattled the public and sent politicians — including those vying to be the next president — scrambling for solutions.

Underscoring the urgency: Bear Stearns (BSC), one of Wall Street's venerable investment banks, received a rescue package by the Federal Reserve and JPMorgan Chase (JPM) on Friday — just hours before Bernanke spoke. It was a last-ditch effort to save the 85-year old institution.

The Federal Reserve responded swiftly to pleas from Bear Stearns that its coffers had "significantly deteriorated" within a 24-hour period. The bank, which had made a fortune in mortgage-backed securities, has ran up $2.75 billion in write-downs since last year, and faced a possible collapse without some kind of lifeline.

To help brace the economy from all the fallout, the Federal Reserve is expected to cut a key interest rate next week. The debate is whether it will be a half percentage point or an even bigger three-quarter-point reduction. Bernanke, in his speech, did not provide clues on that front.

Instead, the Fed chief's speech stuck closely to steps the Fed is taking to prevent prospective home buyers from getting burned in the future when they take out a mortgage.

On this front, the Fed has a proposal that would restrict lenders from penalizing risky borrowers who pay loans off early, require lenders to make sure these borrowers set aside money to pay for taxes and insurance and bar lenders from making loans without proof of a borrower's income. It also would prohibit lenders from engaging in a pattern or practice of lending without considering a borrower's ability to repay a home loan from sources other than the home's value. The proposal also would curtail misleading ads for many types of mortgages and bolster financial disclosures to borrowers.

"The combination of stricter regulation and better disclosure will not solve all the problems," Bernanke said. "We do believe, however, that this proposal will give consumers much better information," he added.

The housing collapse dragged down home values, clobbering borrowers. Many were left with mortgages that exceeded the value of their homes. They were further socked by low introductory rates on their adjustable mortgages, which then reset to higher rates, making their monthly payments difficult or impossible, to afford.

"For a number of years, rapid increases in house prices effectively insulated lenders and investors from the effect of weaker underwriting, providing false comfort," Bernanke said.

HUD recommends change in mortgage disclosures
BuBusiness Courier of Cincinnati - by Kent Hoover Washington Bureau Chief

New disclosure rules for mortgages should give consumers a clearer understanding of loan terms and closing costs.

Under the proposed rules, issued in March by the Department of Housing and Urban Development, people buying or refinancing a home would be provided with a standard Good Faith Estimate that prominently displays the loan's interest rate and monthly payment, whether that interest rate can increase and by how much, and whether the loan has a prepayment penalty or balloon payment.

The first page of the document also would list the loan's estimated closing costs, so buyers could compare offers.

"A lot of the mortgage problems we see today are directly related to the fact that few people fully understand this process," said HUD Secretary Alphonso Jackson.

HOUSING VOUCHER ASSISTANCE WILL BE CUT UNLESS HUD DOES MORE

On April 22, the Department of Housing and Urban Development issued a notice making far-reaching changes in its policy for funding “Section 8” housing vouchers during 2004. A new Center report, Further Action by HUD Needed to Halt Cuts in Housing Assistance for Low-Income Families, explains that HUD’s policy is forcing state and local housing agencies across the country to make cuts in voucher assistance that will cause significant hardship among low-income families.

On May 20, HUD Secretary Jackson announced steps to mitigate the harmful effects of the new policy. These steps (adjusting HUD’s new method of calculating agencies’ funding levels and providing some unused 2003 funds to about a fifth of agencies) reduced the magnitude of the required reductions but have not eliminated the need for harsh cuts by many agencies.

Some agencies are raising the rental charges that voucher holders must pay by reducing the amount of rent that a voucher can cover and thus shifting costs from the voucher program to low-income tenants. Other agencies are reducing the number of families they assist. Some agencies’ funding shortfalls are so severe that they have been forced to terminate assistance to some low-income families that currently rely on vouchers to help pay the rent.

New policy provides inadequate funding to support vouchers in use. Traditionally, HUD has given agencies enough funds to cover the actual costs of the vouchers they are authorized to administer. HUD’s new funding system departs sharply from this practice.
Under the new system, HUD will limit each agency’s average funding per voucher to the agency’s average per-voucher cost for May-July 2003, plus an adjustment for rent inflation that has occurred since then in that part of the country (as determined by a HUD-devised formula). In many local areas, however, voucher costs have risen more than HUD’s rent inflation factor for that part of the country, usually for reasons largely beyond local agencies’ control. Agencies in these areas will not receive sufficient funds to pay landlords for the vouchers now in use. Nationally, the shortfall will exceed $183 million, according to the National Association of Housing and Redevelopment Officials.

Many agencies being forced to reduce the amount of assistance they provide. To fit within the lower funding levels under HUD’s new system, many agencies are cutting the maximum amount of rent a voucher can cover. That raises the rent burden on families and makes it harder for them to use their vouchers to move to neighborhoods with more jobs, better schools, and less crime. In some cases, families may be unable to find a unit they can afford with their smaller voucher and will have to return it.
A HUD home is a home that has been acquired by the U.S. Department of Housing and Urban Development. The properties are usually single family residences or condos and can be in different states of disrepair.

In general, a HUD home attracts a wide range of potential home buyers. Investors flock to HUD homes in order to find a distressed property that can be fixed up and resold at a higher price. Teachers and police offers have the opportunity to purchase a HUD home at 50% off of the sales price. Other home buyers are drawn to a HUD home because they are looking for a home that is below market value and realize that they can buy a larger home than they would normally qualify to purchase.

If you are a first time home buyer it is advisable that you work with somebody who has dealt with purchasing a HUD home in the past. Most notably if you are working with a Realtor make sure they have been through the process. HUD homes are generally sold "as is", meaning they do not warrant the condition and very rarely fix anything.

Also, HUD requires that all bidders must be pre-approved to purchase the HUD home. In other words, if you are looking to finance the property, you must make application and have a conditional loan commitment from a qualified lender, unless you plan on paying cash for the property. If you are paying "all cash" for the property you will need to provide HUD sufficient evidence to show that the he or she has enough cash to purchase the home. Sufficient evidence that HUD may ask for includes a bank statement, deposit slip, or a letter signed by a banker.

Why Does HUD have homes to sell?

The United States Department of Housing and Urban Development (HUD), is the federal agency that oversees the resale of "HUD homes". HUD homes refer to HUD foreclosure property that was conveyed to HUD when a homeowner failed to make payments on their FHA insured mortgage. Many times the people that were foreclosed make significant damage to the homes before they vacate the property. Others leave the homes in pristine condition.

HUD has classified purchasers into two categories:

1) Owner-occupied buyers: An owner-occupied buyer is a person that will occupy the property as his or her primary residence within 30 days of the close of escrow

2) Investors. . An investor is essentially everybody else—people looking to buy real estate as an investment, someone looking for a second home

Where to find a HUD Home:
Most homes for sale by HUD can be found through your local Real Estate Agent. Once a property is available for sale it is listed in the local Multiple Listing Service (MLS). There are also many internet sites that for a fee will provide a list of foreclosed homes for sale. Some are HUD homes, or they may be homes available through other agencies such as VA, FHLMC (Freddie Mac), FNMA (Fannie Mae), or regular bank owned REO.

THE CINCINNATI HUD SECTION 108 LOAN GUARANTEE PROGRAM

PROGRAM: The HUD 108 Loan Program allows communities to borrow funds for CDBG-eligible activities. (The funds are not part of Consolidated Plan resources.) HUD sponsors the sale of deventures to the private financial market to raise capital for the loans. However, a community's future CDBG allocation and other resources are pledged as security for the loan. Funds can be borrowed by a community to pay for CDBG eligible expenditures, or to enable a grantee to make fully amortized loans to private entities undertaking CDBG-eligible activities. The community is held responsible for repaying the HUD 108 Loan funds.

TYPE OF ASSISTANCE: Loans funded through the Community Development Block Grant (CDBG) program.

ELIGIBILITY: Must benefit low and moderate-income persons or aid in the elimination or prevention of slums or blight, or meet urgent needs of the community. Must be a high priority community development project for which there are no other sources of funding available but which will result in exceptional community benefits. The project owner and/or developer must show evidence of professional expertise and experience in undertaking similar projects, or retain the professional expertise relevant to the project. Underwriting standards should require some equity participation from the owner and/or project developer, except in very unusual circumstances. The project must show clear evidence that sufficient cash flow will be generated to cover the debt service on the loan so that future CDBG funds do not have to pay for debt service.

ELIGIBLE/ INELIGIBLE USES: Economic development activities eligible under CDBG, acquisition of real property, rehabilitation of publicly owned real property, housing rehabilitation eligible under CDBG, construction, reconstruction or installation of public facilities (including street, sidewalk, and other site improvements), related relocation, clearance and site improvements, payment of interest on the guaranteed loan and issuance costs of public offerings, and debt service reserves. Ineligible uses to be identified.

RATES/TERMS: Interest rates subject to change. Loan term must be consistent with the nature of the asset being financed (up to 20 years). HUD has the ability to structure the principal amortization to match the needs of the project and borrower. Each annual principal amount will have a separate interest rate associated with it. The total outstanding 108 Loan balance in the aggregate may not exceed an amount equal to the most recent entitlement grant. The total annual debt service on all outstanding 108 Loan balances may not exceed the revenue stream generated annually by CDBG program income. The project must show clear evidence that sufficient cash flow will be generated to cover the debt service on the loan so that future CDBG funds do not have to pay for debt service. Private lender participation and other sources of funding must be pursued to minimize public participation and to obtain a professional assessment for project feasibility. Collateral must be required in the form of personal guarantees, mortgages, etc., from the project owners and/or developers.

APPROVAL: A formal internal review process organized among staff from the Departments of Finance, Law, and Community Development. All loans require Community Development Advisory Board review, a public hearing and City Council approval.

PROGRAM EXAMPLES: Avondale Town Center

Contact: Bill Fischer, Business Development Manager

Phone: (513) 352-3785

Fax: (513) 352-6257

bill.fischer@cincinnati-oh.gov

National Homeownership Month presented an opportunity for HUD's Cincinnati Field Office to join with other involved local partners and host a forum on Homeownership for People with Disabilities. The local training program underscored HUD's support for President Bush's New Freedom Initiative, launched last June to improve opportunities for community integration of people with disabilities.

There are special challenges involved in homeownership for persons with disabilities. At the forum, one panel frankly discussed the disadvantages - and advantages - of homeownership, and how to help individuals and families decide what is the best option for them. Substantial information was provided on resources that can help disabled persons become homeowners, including FHA Mortgage Insurance, Homeownership Vouchers, and downpayment assistance programs.

The forum was targeted at service providers who work with people with disabilities, with a special effort to reach case managers, service coordinators, and vocational rehabilitation counselors. The half-day programs also qualified the participants for professional Continuing Education Units (CEUs). The program was well received, and participants found the information to be timely and relevant to their job responsibilities.

Some of the partners who worked to increase homeownership for people with disabilities were (left) Debbie Greenebaum with Living Arrangements for the Developmentally Disabled; Denise Brooks with the HUD Cincinnati Field Office; and Joanne Brady with the Home Ownership Center. (Right image) A sample of the 50 service professionals and service consumers who took part in the Cincinnati Forum on Homeownership for People with Disabilities.

In addition to HUD, other partners who planned and helped make the forum a success included the Center for Independent Living Options, Living Arrangements for the Developmentally Disabled, the Hamilton County Section 8 Program, USDA Rural Development, and local housing counseling agencies. As a preview to the Forum, the partners jointly provided an exhibit on homeownership at a consumer fair at Cincinnati's Children's Hospital held during May, Minority Health Month.