HUD Provides FHA Financing for Foreclosed Properties

Shaun Donovan, secretary of the US Department of Housing and Urban Development (HUD), will temporarily permit buyers to use FHA-insured financing to purchase real-estate owned (REO) property to stave off vacancies. The waiver will take effect on February 1, 2010 and remain available for one year. It will be subject to extension or withdrawal by the Federal Housing Administration (FHA) commissioner David Stevens. To protect FHA borrowers from predatory “flipping” practices, where properties are quickly resold at heightened prices to borrowers, HUD laid down some general conditions.

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