Fudge also had been under consideration for agriculture secretary, but in the last week the Biden transition team turned their focus to HUD. The announcement could come later this week, the people said.
Biden has been reluctant to pick many Democratic members of Congress, given their narrow margin in the House and uncertainty in the Senate. But Fudge, an Ohio Democrat, represents a safe seat and was deemed an exception.
Politico was first to report on the pick. The Biden transition team declined to comment to CNN.
Fudge did not confirm her selection on Tuesday evening, telling CNN, "If I were to be named, certainly it's an honor and a privilege to be asked to be in a President's Cabinet. It is something that probably in my wildest dreams I never would have thought about."
"So if I can help this President in any way possible, I'm more than happy to do it," Fudge said. "It's a great honor and a privilege to be part of something so good."
A source familiar with the matter said Fudge was "happy" to have accepted the position, despite her preference and public campaign to lead the Agriculture Department.
"She's ready to serve," the source said. For the transition, Fudge was viewed as a flexible, highly skilled utility player. After vetting, the question was "where to put her, what would be the best use of the skills."
Under Ohio state law, when there is a vacancy for a member of the US House of Representatives, it is up to the governor to order a special election to fill the seat. There are no specific deadlines listed for when the special election must be held.
Fudge has represented Ohio's 11th Congressional District since 2008. The congresswoman serves on a number of committees, including the House Administration, Agriculture, and Education and Labor committees. She previously chaired the Congressional Black Caucus.
She chairs the House Administration Committee's Subcommittee on Elections and the Agriculture Committee's Subcommittee on Nutrition, Oversight and Department Operations.
In 2018, Fudge publicly weighed a bid against Nancy Pelosi for speaker of the House, but ultimately threw her support behind Pelosi, who won reelection. Some Democrats at the time were calling for change at the top of the Democratic leadership hierarchy. Rep. Cedric Richmond, who was the chairman of the CBC at the time, said he would support Fudge if she decided to challenge Pelosi.
Fudge made history as the first woman and first African American to be elected mayor of Warrensville Heights, Ohio. She served as mayor from 2000 to 2008. She began her career in the Cuyahoga County Prosecutor's Office.
Biden has been facing increasing pressure to diversify his Cabinet and nominate people of color to top posts in his administration. The President-elect has long pledged to nominate a Cabinet that reflects America's diversity.
The President-elect on Tuesday met with leaders at the NAACP, who are pushing Biden to create the role of civil rights czar. The role would follow the model that Biden has already established in naming John Kerry to a Cabinet-level position as a presidential climate envoy.
NAACP President Derrick Johnson told CNN last week that his organization and other civil rights groups had requested time with Biden and Harris to discuss the incoming administration and ensuring minority and civil rights representation in their agenda.
Biden has already named several people with diverse backgrounds to his Cabinet, including UN Ambassador nominee Linda Thomas-Greenfield, a Black woman; Secretary of Homeland Security nominee Alejandro Mayorkas, a Cuban American man who would be the first Latino to serve in the position if confirmed by the Senate; Neera Tanden, who is the first woman of color and first South Asian person nominated to lead the Office of Management and Budget; Cecilia Rouse, who will be the first woman of color nominated to serve as chair of the Council of Economic Advisers, a position Biden said last week he would elevate to the Cabinet level; and Health and Human Services nominee Xavier Becerra, who would make history as the first Latino to run the department if confirmed.
Vice President-elect Kamala Harris will also make history as the first woman, first Black person and first person of South Asian heritage to serve as vice president.
This story has been updated with additional information about Biden's Cabinet.
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