Since the slowdown in the housing market years ago, options for 100% home financing have pretty much disappeared. In fact today only a few home loan options in Georgia remain that allow NO down payment home financing – USDA and VA. USDA loans require the property to be located in a rural defined eligible area, so unless you are looking to live outside of the big city, this option is not feasible. VA loans are only reserved for past or present military homebuyers. But there is one other less known option for 100% financing here in Georgia, that program is the FHA-HUD $100 Down Program. Many buyers are not aware that FHA and HUD have a special 100 dollars down mortgage program, mainly because this is a specialty program that very few lenders and banks specialize in .
To begin we need to discuss what exactly is a HUD owned property and how you find one. A HUD home is a house that has been foreclosed on that had homeowners that originally used an FHA mortgage to purchase the property. The homeowner could not make the payments for whatever reasons and the bank was forced to foreclosed on the house. HUD then reimburses the lender or bank for what is owed to the lender and HUD takes ownership of the property. Once HUD takes back ownership they will start to prepare the property for sale. It is then listed with a local HUD approved Real Estate Broker. This is when the property is made available to the public for bid!
Ok, now to the good part, the HUD 100 Down Payment Program. To be able to take advantage of this great program you will have to use FHA financing to purchase the property. The normal down payment for an FHA home loan is 3.5% with a max 96.5% financing. The main reason HUD offers the $100 down payment program is to sell HUD foreclosed homes fast and quickly get owner occupant into the homes. They believe people who own their home will take care of it better than a renter thus improving the overall neighborhood. This program is only for people who are going to buy the homes to live in. The HUD 100 down program is not for investors or vacation homes. Homes that are being sold by other sellers ARE NOT eligible, please note this. Georgia homebuyers can find a complete list of approved HUD owned homes in your area by clicking here.
Let’s discuss the benefits of the HUD 100 down program in Georgia:
- Flexible credit qualifying under normal FHA Guidelines.
- $100 down payment instead of the usual 3.5% minimum FHA requirement.
- Eligible for up to $5,000 in escrowed repairs.
- HUD can also pay buyers closing costs as part of the contract negotiations.
Even though buyers only have to pay $100 down payment, they will still need a good faith deposit to hold in escrow when their contract is taken. HUD requires a buyer to submit with the purchase contact earnest money of $1,000 if the purchase price is over $50,000 and $500 if the purchase price is under $50,000.
Homebuyers that have questions about the HUD 100 down program, or would like to start an application, please call us at Ph: 904-810-2293 or just submit the Quick Request Form at the top of this page. We serve home buyers throughout Florida, Georgia, Alabama, Tennessee and Virginia – including Atlanta, Valdosta, Albany, Columbus, Savannah, Thomasville, Macon