When you go to the settlement table, the seller (HUD) receives cash. How you get the cash that you bring to the table can involve financing.
If you do not bring your own cash to the table, you can obtain a loan and bring someone else's cash to the table. You can also do a combination of both -- borrow part of the purchase price and use your own funds for the balance.
Quote:I just want to find out if I can get financing on a hud home Instead of paying cash.Yes you can.
As I mentioned earlier, you can bring your own financing to the table rather thn your own cash. If you want to use the HUD property you are purchasing as collateral, your lender will base the financing upon the purchase price or the appraised value whichever is less.
If you don't use the HUD property as collateral for your loan:If you have the resources, you can also use a personal loan to get the cash needed to complete the purchase.
You can use a home equity loan on your primary residence.
You can refinance other property you already own to get the cash.
You can borrow the amount you need from a private lender, such as a family member.
If you have a high enough credit line and the available credit, you can take a cash advance on your credit cards to get the cash you need for settlement.
You can borrow the money you need against your life insurance policy's death benefit.
You can borrow the money you need from your IRA.
You can....etc.HUD does not do seller financing, but any other methods to finance a traditional property purchase can be used to finance your HUD foreclosureproperty purchase.
The one part that you may not know is that when you buy from HUD The bank will usually require a Home Inspection. As these houses tend to be"beat up a bit" so if you are considering a bank loan you must ask if the house has to be brought up to code before or after the close. I have seen both. Anything that has to be done will come out of your pocket HUD sells as is properties.
Remember when dealing with a HUD home and bidding on it you are dealing with what HUD nets. If you ask them to pay for closing costs it lowers the net that HUD receives thus making your bid not as attractive as someone else bidding the same amount but not asking for closing costs.
Example: (not a true example because I'm not including commissions)
HUD home asking price: 100K
Bid One: 95K with 3K of closing costs
NET: 92K
Bid Two: 94K with NO closing costs
NET: 94K
Even though Bid One is for a greater amount Bid Two brings a greater net to HUD
When you go to the settlement table, the seller (HUD) receives cash. How you get the cash that you bring to the table can involve financing.
If you do not bring your own cash to the table, you can obtain a loan and bring someone else's cash to the table. You can also do a combination of both -- borrow part of the purchase price and use your own funds for the balance.
can you get a loan from a bank or such?
If so, would I tell them it's for a house or personal?
You would want to be honest with them when they ask you if you are going to live in it. In this case with HUD, honesty is the best policy!! Good luck
Of course I would be honest. I just want to find out if I can get financing on a hud home Instead of paying cash.
a lot of times HUD will pay for your closing cost if you ask for it.
Quote:I just want to find out if I can get financing on a hud home Instead of paying cash.Yes you can.
As I mentioned earlier, you can bring your own financing to the table rather thn your own cash. If you want to use the HUD property you are purchasing as collateral, your lender will base the financing upon the purchase price or the appraised value whichever is less.
If you don't use the HUD property as collateral for your loan:If you have the resources, you can also use a personal loan to get the cash needed to complete the purchase.
You can use a home equity loan on your primary residence.
You can refinance other property you already own to get the cash.
You can borrow the amount you need from a private lender, such as a family member.
If you have a high enough credit line and the available credit, you can take a cash advance on your credit cards to get the cash you need for settlement.
You can borrow the money you need against your life insurance policy's death benefit.
You can borrow the money you need from your IRA.
You can....etc.HUD does not do seller financing, but any other methods to finance a traditional property purchase can be used to finance your HUD foreclosure property purchase.
thanks, now I have a clear understanding of it
The one part that you may not know is that when you buy from HUD The bank will usually require a Home Inspection. As these houses tend to be"beat up a bit" so if you are considering a bank loan you must ask if the house has to be brought up to code before or after the close. I have seen both. Anything that has to be done will come out of your pocket HUD sells as is properties.
Just a little more info for you
Lori
[addsig]
Remember when dealing with a HUD home and bidding on it you are dealing with what HUD nets. If you ask them to pay for closing costs it lowers the net that HUD receives thus making your bid not as attractive as someone else bidding the same amount but not asking for closing costs.
Example: (not a true example because I'm not including commissions)
HUD home asking price: 100K
Bid One: 95K with 3K of closing costs
NET: 92K
Bid Two: 94K with NO closing costs
NET: 94K
Even though Bid One is for a greater amount Bid Two brings a greater net to HUD
Q