Tenants Wanting to Buy Can Get First Look at FHA Foreclosures
Do you want to buy your first home? On May 5, 2022, the Federal Housing Authority (FHA) announced a new program to help first-time home buyers find property to purchase. Basically, tenants wanting to buy can get first look at FHA foreclosures before investors. The goal is to ensure more single-family properties go toward home ownership than to investors who turn the homes into rentals.
What is the program?
- For the first 30 days that a foreclosed property is listed for sale, only owner-occupant buyers, approved nonprofits, and government entities can make an offer.
- Once a sales contract is signed, a buyer has an additional 60 days to secure financing and close the purchase.
- The program must be implemented for all post-foreclosure sales by early August.
How to participate?
- Contact an agent and tell them that you want to look at FHA foreclosure.
- Owner-occupant buyer provides a signed statement that states intent to use the property as a principal residence.
- Nonprofit buyers get preapproved by HUD.
- Government entities submit a signed statement on their letterhead stating they are a government entity.
- Buyers have a minimum of 15 days after the contract signing to cancel the purchase if there is an issue with the property’s condition.
- Purchasers can cancel the contract up to 7 days before the closing date due to issues with the title.
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