Buy a HUD Home With Just $100 Down

The HUD Home $100 Down Program is a special FHA financing option that may allow eligible homebuyers to purchase certain HUD-owned homes with as little as $100 down.

Also commonly referred to as the HUD REO Program, FHA $100 Down Program, or HUD $100 Down, this program can dramatically reduce the upfront cash needed to purchase an eligible HUD foreclosure.

For qualified buyers who find an eligible HUD-owned property, it can be one of the most affordable paths to homeownership.

Hud Home 100 Down program

What Is the HUD $100 Down Program?

When a homeowner with an FHA-insured mortgage goes through foreclosure, the property may eventually become owned by the U.S. Department of Housing and Urban Development (HUD). These properties are commonly called HUD homes, HUD-owned homes, or HUD REO properties.

Eligible HUD-owned properties may qualify for special FHA financing that reduces the normal FHA minimum down payment requirement to just $100.

Instead of needing the standard FHA down payment, an eligible buyer purchasing a qualifying HUD home may be able to finance nearly the entire purchase price.

Key potential benefits include:

  • As little as $100 down on eligible HUD-owned properties
  • FHA financing with flexible qualification guidelines
  • Available to qualified owner-occupant buyers
  • Potential ability to finance eligible repairs through FHA renovation financing
  • Lower upfront cash requirement than a standard FHA purchase
  • FHA’s generally flexible credit and debt-to-income guidelines
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How Does the HUD $100 Down Program Work?

The $100 Down Program is specifically tied to eligible HUD-owned properties. You cannot use the program to purchase just any home for sale.

The process generally works like this:

1. Find an Eligible HUD Home

The property must be owned by HUD and offered for sale as a HUD home.

HUD properties are homes acquired by HUD following foreclosure on an FHA-insured mortgage.

Search for eligible HUD Homes >

2. Submit an Offer

HUD homes are sold through a bidding process. Your real estate agent submits the offer on your behalf according to HUD’s property-sale requirements.

3. Apply for FHA Financing

If your offer is accepted, you apply for FHA financing through an FHA-approved mortgage lender.

The borrower still needs to meet applicable FHA income, credit, debt-to-income and occupancy requirements.

4. Put As Little As $100 Down

For eligible transactions using the HUD $100 Down incentive, the required minimum down payment may be reduced to $100.

5. Complete the Mortgage and Closing Process

The property and borrower must satisfy the applicable HUD and FHA requirements before the mortgage can close.

Who Qualifies for the HUD $100 Down Program?

The HUD $100 Down Program isn’t available on every property or to every buyer.

Generally, you should expect to meet FHA borrower requirements and the specific requirements associated with purchasing a HUD-owned property.

Qualification can include factors such as:

  • Purchasing an eligible HUD-owned home
  • Meeting applicable owner-occupancy requirements
  • Demonstrating sufficient income to repay the mortgage
  • Meeting FHA credit requirements
  • Having an acceptable debt-to-income ratio
  • Completing the required FHA/HUD documentation
  • Using an FHA-approved lender

You do not necessarily need to be a first-time homebuyer to use FHA financing. What matters is whether you, the property and the transaction meet the applicable program requirements.

HUD $100 Down vs. Regular FHA Loan

A major difference between a regular FHA purchase and the HUD $100 Down Program is the upfront down payment.

Standard FHA Purchase
A standard FHA mortgage generally requires a minimum down payment of 3.5% for qualifying borrowers. On a $250,000 home, 3.5% would equal: $8,750 down

HUD $100 Down
On an eligible HUD-owned property using the $100 Down incentive: $100 down

That’s a potential difference of $8,650 in upfront down payment on a $250,000 purchase.

Keep in mind that a down payment is only one component of the money needed to purchase a home. Buyers may still have closing costs, prepaid expenses, inspections and other costs associated with the transaction.

Can You Finance Repairs on a HUD Home?

Possibly.

HUD-owned homes are frequently sold after foreclosure, which means some properties need repairs or improvements.

Depending on the condition of the property and how HUD classifies it, different FHA financing options may be available.

For homes requiring rehabilitation, an FHA 203(k) renovation loan may allow qualified borrowers to finance both the purchase of the property and eligible renovation costs into a single mortgage.

This can be particularly useful when purchasing a HUD home that has significant potential but needs work before or after occupancy.

Are HUD Homes Foreclosures?

HUD homes are generally properties HUD acquired after foreclosure on an FHA-insured mortgage.

That’s why you’ll frequently see several different terms used when searching for these properties:

  • HUD homes
  • HUD-owned homes
  • HUD foreclosure homes
  • HUD REO properties
  • FHA foreclosures

These terms often refer to the same general category of HUD-owned real estate, although the specific financing and property eligibility requirements can vary.

Do You Have to Be a First-Time Homebuyer?

No.

The HUD $100 Down Program should not be confused with a first-time homebuyer-only program.

Eligible repeat buyers may potentially qualify as long as they meet the applicable FHA and HUD requirements, including any owner-occupancy requirements associated with the transaction.

Can Investors Use the HUD $100 Down Program?

The $100 Down incentive is designed around eligible owner-occupant purchases rather than traditional investment-property financing.

HUD may sell properties to investors under certain circumstances, but that does not mean an investor qualifies for the same FHA $100 Down financing available to an eligible owner-occupant.

If you’re considering a HUD property as an investment, we can review the property and determine what financing options may be available.

Why Consider Buying a HUD Home?

For the right buyer and property, purchasing a HUD home can create an unusual opportunity.

You may be able to combine:

A HUD-owned property + FHA financing + a potentially very low down payment.

Click here to search your area for an eligible HUD Home.

The important part is determining whether the specific property qualifies and structuring the financing correctly.

That’s where working with a mortgage team familiar with HUD REO and FHA financing can make a difference.

Get Pre-Approved for a HUD Home

Thinking about purchasing a HUD home?

Before submitting an offer, it makes sense to understand exactly how much you qualify for and whether the property you’re considering can be financed using the HUD Home $100 Down Program.

The Moreira Team | MortgageRight can review your situation, explain the FHA financing options available and help you determine whether the HUD property you’re considering qualifies.

See if you qualify for HUD $100 Down financing.

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HUD $100 Down Program FAQs

What is the HUD $100 Down Program?

The HUD $100 Down Program is a special FHA financing option that can reduce the required down payment to as little as $100 when an eligible borrower purchases a qualifying HUD-owned property.

Is HUD $100 Down the same as an FHA loan?

It uses FHA financing, but the $100 down feature applies to eligible HUD-owned properties and qualifying transactions rather than ordinary home purchases.

What is a HUD REO property?

REO means Real Estate Owned. A HUD REO is generally a property HUD acquired following foreclosure on a home with an FHA-insured mortgage.

Do all HUD homes qualify for $100 down?

No. Property and transaction eligibility must be verified. Buyers should confirm eligibility before assuming a particular HUD listing qualifies for $100 down financing.

What credit score do I need?

Credit requirements depend on FHA guidelines as well as lender underwriting requirements. Your overall credit profile, income, debts and other factors are considered when determining eligibility.

Can I use the program in Georgia?

Eligible HUD-owned properties in Georgia may potentially qualify when the borrower, property and transaction satisfy applicable program requirements.

Can I buy a HUD home that needs repairs?

Potentially. Depending on the property’s condition and eligibility, FHA renovation financing such as an FHA 203(k) loan may provide a way to finance eligible improvements along with the home purchase.

Is the HUD $100 Down Program only for first-time buyers?

No. FHA financing isn’t limited to first-time homebuyers. Eligible repeat buyers may also qualify.

Can I use down payment assistance with a HUD home?

That depends on the specific assistance program and transaction. Because the HUD $100 Down incentive already substantially reduces the required down payment, we recommend reviewing the complete financing structure before combining programs.

How do I get started?

The first step is getting pre-approved for FHA financing. Once you’re pre-approved, you can work with your real estate agent to identify eligible HUD-owned properties and submit an offer.

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