HUD Foreclosures

The basics of a HUD foreclosure

The Department of Housing and Urban Development or HUD is a government agency that is responsible for addressing housing needs in the United States. It was established in 1965 and has a variety of programs available to help people obtain and maintain housing. One of the major focuses of HUD is to help lower income families with housing needs. HUD owns homes which it then sells to low income families for affordable prices. As with any home buying experience there is a chance that a HID home can go into foreclosure. HUD, however, has many options available to avoid foreclosure if at all possible.

Once payments are missed the lender will start the foreclosure process. Both your lender and HUD can pursue foreclosure actions against you. The first step in this process for the homeowner is to contact the lender and try to set up a new payment plan that will get them back on track and stop foreclosure. While trying to find a solution it is important not to abandon your home because HUD may not be able to help you if you do so. There are HUD-approved counseling agencies that may also be able to help you get your payments back on schedule. You should contact HUD to find one of these agencies. They may also be able to help you find government agencies that can help you. Most of the counseling services offered by HUD are free of charge.

HUD has a process by which it handles foreclosures to help homeowners try to stop the process. It is sponsored by the Federal Housing Administration or FHA which is a part of HUD. It is called the FHA Loss Mitigation Program. The Loss Mitigation Program gives lenders the ability to offer HUD approved options to stop the foreclosure. These options include special forbearance, modifications, partial claim, pre-foreclosure sale, and a deed-in-lieu of foreclosure. Special forbearance and mortgage modification allow you to keep your home while setting up special payment plans to help you afford the mortgage payments. A pre-foreclosure sale and deed in lieu of foreclosure both result in you losing your home, but prevent a foreclosure form ruining your credit.

If you can not work through the financial troubles you will go through the normal foreclosure procedures. You will lose your home and end up with a foreclosure on your credit. HUD and your lender do not want to see this happen. HUD will help you to try to avoid losing your home in every way possible. It is your responsibility, though, to work with HUD to make this happen. Do not just abandon your home because you will still be ultimately responsible for your debt.

Once you default on a mortgage payment you are going into foreclosure. HUD can help you but only if you are willing to work with them and their partners. Every possible step should be taken to try to stop a HUD foreclosure. Once you have experienced a foreclosure on a HUD property you may be unable to get assistance from HUD again in the future.