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HUD Financing Requirements

What is a HUD Loan?

HUD homes are foreclosed properties that were originally purchased with FHA loans. Residential properties become HUD homes when a homeowner is unable to keep up with their monthly mortgage payments and defaults on their loan. The FHA steps in, pays the remaining mortgage balance to the lender, and seizes the homeowner’s property.

In order to recoup the cost, the government will sell these homes, often slightly below market value, to encourage home buyers to purchase them

HUD loans are also called FHA (Federal Housing Administration) Hud Financing Requirementsloans, are mortgage loans that are offered by private lenders and insured by the FHA.  The FHA is an agency within HUD (Department of Housing and Urban Development).

How Do HUD Loans Work?

HUD loans are insured by the FHA and this protection allows lenders to offer low-interest rates, accept low down payments, and approve borrowers whose credit may not be rated high.

HUD Financing Qualifications

In order to qualify for a HUD loan, you must have a minimum credit score of 580 and 3.5% down.  HUD has local Public Housing Agency offices. Go to the local office in the city where your property is located. Request an application called Request for Unit Approval. The application gathers information on the location, price, and inclusions provided in the unit.

HUD will automatically pay certain closing costs at settlement. Other closing costs may be paid by HUD in accordance with the terms of the form HUD-9548.

What Type HUD Mortgage Types Require Radon Testing?

Both Multifamily Accelerated Processing and Traditional Application Processing applications for funding require radon testing and mitigation if elevated levels above 4. pCi/L (picocuries) .  Below describes the type of HUD properties that need radon testing:

  • New construction or substantial rehabilitation of mixed-use projects in urban renewal areas.
  • New construction or substantial rehabilitation of multifamily rental or cooperative housing for moderate‐income families, elderly, and the handicapped by profit‐motivated sponsors
  • Purchase or refinance of existing multifamily rental housing that does not require substantial repairs.
  • Construction and substantial rehabilitation of rental housing for the elderly or disabled
  • Refinance of original HUD-insured mortgages.  Radon testing is not required but is encouraged.

If you need a radon test for your HUD property, please contact us at 1-866.476.2773

Please Contact Us For Your 
HUD Radon Needs

866.476.2773

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