HUD homes for sale are expected to attract more buyers because of the growing inventory of HUD foreclosures, the availability of loans guaranteed by the Federal Housing Administration and the rising number of home ownership assistance programs offered by state and local governments.

In November 2009, almost 40 percent of all buyers of existing homes nationwide used an FHA loan, according to a report released by the National Association of Realtors.

But prospective buyers need to exert effort to know all they can about buying HUD homes so they can avail of programs or incentives available to them.

Changes in federal housing programs have been frequent in recent months because of the desire of the Obama administration to help cut down the nationwide foreclosure inventory and to help the housing market recover. So smart home buyers need to be updated with developments so they can take advantage of incentive or assistance schemes in connection with the purchase of foreclosed properties.

One program of the HUD that professionals like teachers, law enforcement officers, firefighters, nonprofit personnel, local government officials and emergency medical technicians can avail of is the special scheme called Good Neighbor Initiatives. Under this program, these selected professionals can buy eligible HUD homes for sale at a 50-percent discount.

Nonprofits and local governments can negotiate further discounts especially if their purchases involve properties that need substantial repairs and rehabilitation and if they use these properties for their low-income or affordable housing programs.

Another special HUD home buying program is the rental and voucher program for residents of public housing. Under this scheme, prospective buyers who are renters of public housing negotiate with their public housing agency officials and apply to convert their rental payments into mortgage payments. They can also apply for homeownership vouchers that would help them bear their monthly housing costs.

Prospective buyers of HUD properties should also look for HUD-certified brokers and counselors who have been working with HUD for a significant period of time and who are updated with HUD programs. These experienced brokers are able to walk them through finding and choosing HUD properties and bidding for their chosen homes successfully.

Some experienced brokers, for instance, offer ways by which buyers can buy HUD houses with only $100 in down payment, can apply for FHA loans, can get closing cost financing from HUD for up to three percent of the home price and can physically inspect the HUD homes for sale and check their titles before making the purchase.

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