HUD Loans help low-income families to enjoy homeownership. The Department of Housing and Urban Development (HUD) promotes homeownership among families in all income brackets. As a part of its core mission, HUD insures mortgage loans for families with poor credit or financial struggles, giving mortgage lenders an incentive to extend loans to borrowers with high default risks. As a type of subprime mortgage loan, HUD loans carry a unique set of advantages and disadvantages to borrowers, lenders, the government and society as a whole.