How to Buy a House Using HUD Funding
The United States Department of Housing and Urban Development (HUD) provides insurance for certain mortgage loans funded by traditional lending institutions. The lender must be approved by the Federal Housing Administration (FHA), a division of HUD, in order to provide HUD-backed loans. There are certain FHA requirements that a home buyer must meet in order to qualify for an FHA-backed loan, and the home you are going to purchase must meet guidelines as well. Since FHA is insuring your loan, the lender can offer you a much better deal than if you were to obtain a traditional loan.
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Instructions
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Decide how much you can afford to pay for a home. The website for Ginnie Mae, a government program that insures loans such as FHA and VA, has a questionnaire and calculator that can give you an estimate of what you can afford to spend on a home.
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Determine what the FHA loan limits are in your area. You can do this by using the form available on the FHA website. This will tell you the highest price you can pay for a home in your area and still qualify for an FHA-backed loan.
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Locate an FHA lender on the HUD website. Only these lenders are allowed to provide an FHA-backed mortgage.
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Call the lender and explain that you would like to become pre-approved for an FHA loan. The lender will walk you through the process.
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