When home buyers are shopping for a home, HUD and FHA loans are terms home buyers often hear without understanding the relationship between the two. HUD stands for Housing and Urban Development. It is the government agency that manages government subsidized or government-backed home loans like FHA loans. HUD also has programs available for rehabbing older homes.
Comparing HUD and FHA Loans
HUD FHA loans and HUD 203(k) loans are similar in that both loan programs have options that allow you to finance the rehabilitation or repair of a property in the mortgage loan. Both loans are government-backed, with less strict credit requirements. While FHA typically works with individual home buyers, HUD loans are also available for commercial and multi-family dwelling units.
What HUD and FHA Can Do
HUD and FHA work to enable citizens to become homeowners who might otherwise not be able to do so by offering the following:
- first-time home buyer programs with low down payment options
- rehab and refinance options to assist you in repairing your property
- low interest rates and better terms
- flexible credit requirements
- assistance in making your home more energy efficient
- HUD FHA Loan Non-Discrimination Policy
HUD and FHA loans are required to comply with HUD's fair lending policy, which means lenders cannot discriminate against you. If you ever feel that you have been the victim of discrimination or predatory lending, you can file a complaint with HUD.