# U.S. Department of Housing and Urban Development (HUD): Role and Programs

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> **Definition**
>
> The Department of Housing and Urban Development (HUD) is a U.S. government agency that supports community development and homeownership.

## What Is the U.S. Department of Housing and Urban Development (HUD)?

The Department of Housing and Urban Development (HUD) is a U.S. government agency that was created in 1965 as part of then-President Lyndon Johnson’s [Great Society](https://www.investopedia.com/terms/g/great-society.asp) agenda to expand America’s welfare state. Its primary mission is [improving affordable homeownership opportunities](https://www.investopedia.com/articles/investing/091514/essential-tips-buying-hud-home.asp) to support the housing market and homeownership in inner-city areas.

HUD’s programs are geared toward increasing safe and affordable rental options, reducing chronic homelessness, and fighting housing discrimination by ensuring equal opportunity in the rental and purchase markets.

### Key Takeaways

*   The Department of Housing and Urban Development (HUD) is a U.S. government agency that supports community development and homeownership.
*   HUD enforces the Fair Housing Act and offers housing assistance through the Community Development Block Grant program and the Housing Choice Voucher program.
*   The Fair Housing Act prohibits discrimination in housing based on sex, race, color, national origin, religion, family status, and disability.

## How the HUD Works

HUD enforces the [Fair Housing Act](https://www.investopedia.com/terms/f/fair-housing-act.asp) and oversees the Community Development Block Grant program and the [Housing Choice Voucher program](https://www.investopedia.com/terms/h/housing-choice-voucher-program.asp). It also supervises other programs to assist low-income Americans with their housing needs. It works with various government agencies and private organizations, including community nonprofits and faith-based groups, to reach its goals.

> **Fast Fact**
>
> Following Hurricane Katrina, HUD became involved in disaster recovery in the Gulf Coast region.

The Fair Housing Act prohibits discrimination in housing based on sex, race, color, national origin, religion, family status, and disability. HUD investigates any cases concerning the refusal to rent or sell a property, denying someone a dwelling, falsely stating that properties are unavailable, and imposing different terms or conditions based on any of the aforementioned discriminating conditions.

HUD is led by the HUD secretary, a member of the president’s cabinet who is nominated by the president and confirmed by the Senate. The position is currently held by Scott Turner, who took office on Feb. 5, 2025.

## Types of HUD Assistance Programs

HUD offers various [assistance programs](https://www.investopedia.com/government-assistance-programs-4845368) for those in need of housing financial assistance.

### Housing

The Office of Housing is the largest office within HUD and includes the Federal Housing Administration. As stated on the HUD website, the duties of the office include:

*   Operating FHA and providing mortgage insurance on mortgages for single-family homes, multifamily properties, and healthcare facilities
*   Operating HUD's Manufactured Housing program
*   Managing HUD's Project-Based Rental Assistance and other rental assistance programs, which provide support for low and very low-income households
*   Supporting the Housing for the Elderly and [Housing for Persons with Disabilities programs](https://www.investopedia.com/low-income-housing-people-disabilities-5220009)
*   Encouraging recapitalization of the nation's aging affordable housing stock through programs such as the Rental Assistance Demonstration
*   Facilitating housing counseling assistance through HUD's Office of Housing Counseling

### Grants

The Community Development [Block Grant](https://www.investopedia.com/terms/b/block-grant.asp) program allocates federal grant money to communities to develop neighborhoods that have decent, affordable housing. These [grants](https://www.investopedia.com/terms/g/grant.asp) typically aid low- and middle-income residents so they can find suitable living environments near employers, supermarkets, or public transportation. States, cities, towns, communities, and organizations apply for these block grants or for loan guarantees to aid in development projects.

### Vouchers

The Housing Choice Voucher program, also called Section 8, allows low-income, disabled, or elderly citizens to choose a place to live regardless of whether the property exists as subsidized housing. The property must meet certain requirements and applicants need to meet government standards to qualify.

Local public housing authorities determine a moderately priced housing option based on local [real estate](https://www.investopedia.com/terms/r/realestate.asp) prices before deciding the benefits that families or individuals can receive. Families then seek out a [housing unit](https://www.investopedia.com/terms/h/housingunits.asp) for the number of people who will live in the house, duplex, or apartment.

> **Important**
>
> A family who is issued a housing voucher must find housing where the owner agrees to rent under the voucher program—and the rental unit must meet standards of health and safety that are determined by the public housing agency (PHA).

The vouchers are administered by local public housing agencies (PHAs) that are funded by HUD. The PHA pays the [subsidy](https://www.investopedia.com/terms/s/subsidy.asp) directly to the landlord on behalf of the tenant, and the tenant pays the difference between the actual rent charged by the [landlord](https://www.investopedia.com/terms/l/landlord.asp) and the amount subsidized by the program. HUD states that to be eligible for the voucher program, the tenant’s income may not exceed 50% of the [median](https://www.investopedia.com/terms/m/median.asp) income for the area.

Families can move from one housing unit to another because of income changes, job status, or the addition of family members. The voucher program attempts to allow for mobility without losing housing benefits. Beneficiaries with vouchers sign leases with property owners that have this program. With subsidized housing, residents sign leases with property managers who oversee federally owned projects.

### The Office of Public and Indian Housing

The Office of Public and Indian Housing (PIH) exists to ensure access to safe, decent, and affordable housing. The PIH also works to create opportunities to help residents become self-sufficient and economically independent.

HUD established its Office of Public Housing to help provide safe and decent rental housing for eligible low-income families as well as older adults and people with disabilities. This includes access to single-family homes as well as housing in multi-unit properties. An estimated 1.2 million households live in public housing units that are managed by entities overseen by HUD.  

### The Office of Community Planning and Development

The Office of Community Planning and Development (CPD) works to develop viable communities by promoting integrated approaches in providing decent housing, suitable living environments, and expanding economic opportunities for low and moderate-income individuals and households. The Office achieves this goal by developing partnerships between the government and private sector organizations, including those that operate on a for-profit and non-profit basis.

### The Office of Policy Development and Research

The Office of Policy Development and Research supports HUD's efforts to create cohesive and economically viable communities by maintaining up-to-date information on:

*   Housing needs
*   Market conditions
*   Existing housing programs

The office is also tasked with conducting research on priority housing and community development issues. The data generated is then used to help inform HUD policy decisions.

### Ginnie Mae

[Ginnie Mae](https://www.investopedia.com/terms/g/ginniemae.asp) makes affordable housing a reality for low- and moderate-income households by helping to funnel capital into the housing market. The Ginnie Mae guaranty program allows mortgage lenders to get a better price for loans in the secondary mortgage market. Lenders can use the proceeds to fund new loans, which enables the mortgage market to maintain [liquidity](https://www.investopedia.com/terms/l/liquidity.asp).

Ginnie Mae doesn't buy or sell loans or issue mortgage-backed securities. But it does guarantee investors the timely payment of interest and principal on mortgage-backed securities that are backed by federally-insured or guaranteed loans.

### Note

Ginnie Mae has never been the recipient of a government bailout.

## What Does the U.S. Department of Housing and Urban Development Do?

The Department of Housing and Urban Development is responsible for administering programs that provide housing and community development assistance, while also ensuring access to fair and equal housing for all.  

## Are Fannie Mae and HUD the Same Thing?

Fannie Mae is a government-sponsored enterprise that is a leading source of conventional [mortgage](https://www.investopedia.com/terms/m/mortgage.asp) financing in the U.S. This entity is separate from HUD and performs a different function within the mortgage market.

## Does HUD Make Loans?

HUD does not offer home loans directly. Instead, the Department of Housing and Urban Development works with a network of approved partner lenders to help homebuyers get the financing they need to purchase homes.

## How Do You Qualify for a HUD Loan?

Qualification for a mortgage loan offered through a HUD program is based on many of the same requirements associated with non-HUD loans. That includes meeting minimum credit score and income guidelines, having a [debt-to-income ratio](https://www.investopedia.com/terms/d/dti.asp) within acceptable limits, and meeting the down payment requirements.

## The Bottom Line

The Department of Housing and Urban Development serves an important role in ensuring that homebuyers are able to secure mortgage loans. FHA loans, for example, can make it easier to buy a home with a smaller down payment and/or a lower credit score. These types of mortgage options help to make homeownership more accessible overall.

> **Article Sources**
>
> 1.  U.S. Department of Housing and Urban Development. "[History of HUD](https://www.hud.gov/about/hud_history)."
>     
> 2.  U.S. Department of Housing and Urban Development. "[HUD Archives: Hurricane Katrina: Ten Years of Recovery in the Gulf](https://archives.hud.gov/news/2015/pr15-108.cfm)."
>     
> 3.  U.S. Department of Housing and Urban Development. "[Housing Discrimination Under the Fair Housing Act](https://www.hud.gov/program_offices/fair_housing_equal_opp/fair_housing_act_overview)."
>     
> 4.  U.S. Department of Housing and Urban Development. "[Housing](https://www.hud.gov/program_offices/housing)."
>     
> 5.  U.S. Department of Housing and Urban Development. “[Community Development](https://www.hud.gov/program_offices/comm_planning/communitydevelopment).”
>     
> 6.  U.S. Department of Housing and Urban Development. "[HUD Announces $9 Million Loan Guarantee to Cleveland for Development with Nearly 200 Housing Units, Grocery Store](https://web.archive.org/web/20221206210012/https://www.hud.gov/press/press_releases_media_advisories/HUD_No_21_209)."
>     
> 7.  U.S. Department of Housing and Urban Development. “[Housing Choice Vouchers Fact Sheet](https://www.hud.gov/topics/housing_choice_voucher_program_section_8).”
>     
> 8.  U.S. Department of Housing and Urban Development. "[Public and Indian Housing](https://www.hud.gov/program_offices/public_indian_housing)."
>     
> 9.  U.S. Department of Housing and Urban Development. "[Public Housing](https://www.hud.gov/program_offices/public_indian_housing/programs/ph)."
>     
> 10.  U.S. Department of Housing and Urban Development. "[Community Planning and Development](https://www.hud.gov/program_offices/comm_planning)."
>      
> 11.  Office of Policy Research and Development. "[About PD&R](https://www.huduser.gov/portal/about/mission_and_background.html)."
>      
> 12.  Ginnie Mae. "[About Us](https://www.ginniemae.gov/about_us/who_we_are/Pages/funding_government_lending.aspx)."