How to Buy a Dollar House

(Last Updated On: January 4, 2018)

Have you heard about the Dollar Homes program? This program is the easiest way to find abandoned homes for sale. All the homes in the Dollar Homes program are previous FHA-loan foreclosures that are empty and just waiting for someone to fix them up.

Looking for other low income home buyer options? Click here!

What is the FHA?

The Federal Housing Administration is part of the US Department of Housing and Urban Development (HUD). It’s also the only government agency that is entirely self-funded and operates without any expense to taxpayers!

The FHA provides mortgage guarantees for many low income home buyers. When those buyers fail to make their payments, the banks foreclose on the home. The buyers lose their home and the FHA acquires the foreclosed home.

Some of these homes are then listed on the Dollar Homes website, where the public can purchase the abandoned homes for sale at rock bottom prices.

What are Dollar Homes?

According to the HUD website, the Dollar Homes initiative was designed to help local governments promote home ownership opportunities for low income families. The homes were intended to be sold for literally $1 each.

Thousands of homes have been sold through this website for just $1 each. However, at the time of this writing, the two “Dollar Homes” listed on the site were listed for $5,950 and $10,447, respectively.

These homes are intended to be purchased by local governments or non-profit organizations who will renovate the home for resale. However, the HUD website indicates that you can make an offer on the home through a HUD-approved broker.

Should I consider abandoned homes for sale?

There are some obvious drawbacks involved in purchasing an abandoned home for sale. Although a “Dollar Home” certainly sounds enticing and the homes are certainly sold for very low prices, there is a serious amount of rehabilitation involved before the home will be a safe, healthy, livable residence.

If you are going to purchase abandoned homes for sale, you need to have funds or the ability to obtain financing for repairs. You may need to take out a loan in order to make your new home livable. Granted, you’ll still be saving money in many cases… but you might end up spending far more than you expected. This is especially true when you consider paying for housing while you’re rehabilitating the home you’ve purchased.

To be completely honest, I do not recommend this program to low income home buyers and I would encourage you to check out this list of alternative low income home buyer programs. 

buying a house with low income

 

How do I buy a Dollar Home?

When you click on the First Time Bidder button the HUD Homes website, you will be instructed to find a registered HUD broker to help you make a bid. However, the site offers a helpful search engine that can help you find a qualifying broker.

Find more resource for low income homebuyers here!



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