Ohio HUD Resale Program: $100 down FHA and $2,500 Bonus SUSPENDED effecitve 2/12/10!

FHA Kills Incentives for Buyers of HUD Homes

I am sorry to be the messenger of bad news. But this is very important for all owner occupants who planned to buy a HUD home in 2010. 
 
HUD announced that effective February 12, 2010 - that's a Friday - HUD homes sold with FHA financing will no longer be eligible for the $100 down payment incentive.
 
In addition, the sales allowance of $2,500 for owner occupant purchasers will also be discontinued. 
 
What's the impact of this drastic reduction of incentives? If you are an owner occupant buyer, it certainly means that you will have to bring more cash to closing and somehow come up with the minimum downpayment required by FHA. Currently, this is still 3.5%, but it may go up to 5% in the near future.
 
For investors and owner occupant buyers with cash this will open up the doors for even better deals. I truly expect the HUD homes inventory to rise after this deadline, fewer homes will be purchased by owner occupants and HUD will be eager to accept lower offers from investors.