The Department of Housing and Urban Development is selling properties that require a cash investment of only $100.
The deal applies to HUD’s real-estate-owned properties, according to Mortgagee Letter 2011-19.
Borrowers can get into the property as long as they qualify for a mortgage that is insured by the Federal Housing Administration.
But the only homebuyer acquisition costs that can be financed is the up-front mortgage-insurance premiums. The limitation extends to 100 percent of the as-is appraised value.
Pre-paid expenses and other closing costs cannot be financed.
HUD said it is authorized to ignore the eligibility limitations of the National Housing Act through provisions of 12 USC 1715n(c).
