The Real Estate Library
The U.S. Department of Housing and Urban Development (HUD) was established in 1968. It was originally developed to manage federal housing and community development programs. HUD incorporated numerous housing agencies and assumed administrative responsibility for them. One of these agencies was the Federal Housing Administration (FHA). Since 1971 the agency has been commonly known as HUD/FHA. The old FHA programs and the newer HUD programs act as an insurance agency for banks, savings & loans and mortgage bankers who make real estate loans to buyers and investors. HUD/FHA does not make the loan, they only insure the lender against loss in the event of default. HUD properties are sold to the public when HUD/FHA mortgages are foreclosed. HUD pays the original lender the amount of the loan due and other expenses. HUD then resells the property. HUD defines a one-to-four unit property as either a single family, duplex, triplex or fourplex. These are properties that can be sold through HUD brokers. HUD defines an apartment complex as a property which has five or more units contained within it. They can be walk-ups, townhouses rented as apartments and have either no garages or detached garages.