What Is the Difference Between HUD & FHA?

Save
HUD and FHA both deal primarily with providing housing.
HUD and FHA both deal primarily with providing housing. (Image: home image by dinostock from <a href='http://www.fotolia.com'>Fotolia.com</a>)

HUD is the commonly used name for the U.S. Department of Housing and Urban Development. HUD offers low-cost homes and grants to help families get adequate housing. FHA, or the Federal Housing Administration, is a division of HUD that provides mortgage insurance for loans on single-family homes that are the primary residences for eligible families.

HUD History

HUD got it's start in 1937 when the U.S. Housing Act was passed. In 1967, HUD was turned into a cabinet-level agency. In the following years, HUD has been responsible for the passing of legislation such as the Fair Housing Act, the Housing Community and Development Act and the Housing and Urban-Rural Recovery Act. HUD has had 14 secretaries since it became a cabinet-level agency. The current HUD secretary is Shaun Donovan, who was appointed by President Barack Obama on January 29, 2009.

HUD has been helping to put families in adequate housing since 1937.
HUD has been helping to put families in adequate housing since 1937. (Image: wood frame housing image by Daniel Gillies from <a href='http://www.fotolia.com'>Fotolia.com</a>)

HUD Departments

HUD runs several programs for community development and housing assistance. HUD's assorted community planning and development programs offer funding for affordable housing projects, Section 8 rehabilitation programs, shelters and economic development. The Office of Fair Housing and Equal Opportunity is a division of HUD that prevents discrimination against people trying to obtain housing assistance. HUD also offers mortgage insurance on loans for building health care facilities and housing counseling classes.

HUD has many programs for community development.
HUD has many programs for community development. (Image: Dreamy house on house plans image by Monika 3 Steps Ahead from <a href='http://www.fotolia.com'>Fotolia.com</a>)

HUD Grants

HUD offers grants for several different groups and uses. Certain communities, small towns and states can apply for grants for community and economic development, as well as grants for building emergency shelters. HUD's website has a page for keeping people updated on grants as funds come available, as well as who is eligible for and how to apply for grants.

Grants are available for many purposes.
Grants are available for many purposes. (Image: cash on black image by Pix by Marti from <a href='http://www.fotolia.com'>Fotolia.com</a>)

HUD Help With Buying a Home

HUD has a page on its website that is dedicated to helping home buyers with the entire process of finding and buying a home. The page includes tools for finding out how much people can afford for a mortgage payment, shopping for the best loan (including FHA loans) and finding a home through MLS listings and HUD databases. There are also tutorials available on the rights of prospective home buyers, avoiding predatory lenders and getting home inspections.

HUD home databases have homes listed at below-average cost.
HUD home databases have homes listed at below-average cost. (Image: house blueprint and house model studio isolated image by dinostock from <a href='http://www.fotolia.com'>Fotolia.com</a>)

About FHA

The FHAs primary function is to offer mortgage insurance to approved lenders on behalf of home buyers. Lenders require mortgage insurance on loans with a down payment of less than 20 percent of the loan value. When home buyers get an FHA-approved loan, the FHA pays the mortgage insurance for them, guaranteeing to lenders that the loan will be paid even if the home buyer defaults on the loan. FHA mortgages often have lower interest rates than conventional mortgages and are available to people purchasing single family and multifamily homes that will be the homeowner's primary residence.

FHA loans have lower payments than conventional mortgages.
FHA loans have lower payments than conventional mortgages. (Image: piggy bank image by Brent Walker from <a href='http://www.fotolia.com'>Fotolia.com</a>)

Related Searches

References

Promoted By Zergnet

Comments

You May Also Like

Related Searches

Check It Out

4 Credit Myths That Are Absolutely False

M
Is DIY in your DNA? Become part of our maker community.
Submit Your Work!