I have $120,000 in a fund with a local bank and want to use this money to become more involved in real estate.

Not with 1000s on the market in your area that are distressed.Not sure I'd want to get involved at all since if you buy it at a foreclosure sale, he may still not want to leave the house, or he might push his best buddy for some extra time to stay rent free.

Other cities do this already, though the program/requirements vary a little from city to city.

First let me congratulate you for making a wise decision by not blowing money you can invest on "guru programs".

I plan on trying to increase equity in any property I get involved in-I have a construction background and a couple of contractrs I would like to get involved with me if this could become a reality.

A home being purchased through the HUD program must be used as a primary residence.

Usually it involves a 1% fee and you will have to be underwritten.

With that said if you were looking to purchase at least you could use this as an option if the owner were to ever receive the OTD (Order to Docket) dont get me wrong some lenders are just down right nasty and will still proceed, but if you have no money involved and just contract paperwork by all means it is worth a try.

Many of the successful firms involved with real estate have returns around 8.0% to 9.0% annually.

Another thing you might consider is to find a local real estate group to join and learn first hand from those actively involved in deals.