Q. What is a "HUD Home"?
The Federal Housing Administration (FHA) is
the organization of the U.S. Department of Housing and Urban Development (HUD)
that insures certain mortgage loans for lenders.
If the lender forecloses on the loan,
FHA repays the balance of the loan to the lender and the title to the home
reverts to HUD.
HUD then sells these homes at market
value. See our
HUD Buyers Guide
Q: How do HUD Contractors acquire the house?
HUD has assigned the responsibility to
maintain and sell the homes to Management and Marketing Contractors
(specialized attorneys). They are responsible for the upkeep of
the property and the required documentation associated with marketing and
selling the homes according to HUD policies and guidelines set forth in the
contract with the federal government.
Q: Who can buy a HUD home? Are they
only available for low-income buyers?
All HUD homes are offered without regard to race, color, religion, sex, national
origin, handicap, or familial status.
Anyone who is pre-qualified for a
mortgage loan may offer to purchase a HUD home.
These homes are not exclusively for
low-income buyers, but most are regarded as affordable for low to
moderate-income purchasers within the market areas where they are located.
There is an initial period when only
owner-occupants are allowed to purchase, after which time investors may also
buy.
No employee, relative, or business
relation of the HUD Contractor or its subcontractors may purchase any of these
properties. See our
HUD Buyers Guide
Q: Is it possible to get a list of
the properties in my area?
We can email, fax or print for pickup
a list of homes available in the cities of your choice.
Q: Does HUD make repairs on
HUD-owned homes that are in poor condition?
HUD homes are sold "as is," without warranty. That means HUD generally will not make
repairs except to preserve and protect the property or to eliminate a major
safety issue. Known defects are reflected in the
price and stated in the listing on the Website, as well as on the Property
Condition Summary sheet.
Q: Can I buy a HUD home as an
investment property?
Yes, but owner-occupant purchasers are given priority for an initial period of
time that the house is on the market.
These are persons who will affirm in
writing that they have not purchased a HUD-owned property in the last two years
and they will live in the home as their primary residence for at least one year.
After the initial listing period, investors
may purchase the houses for resale or for rental. See our
HUD Buyers Guide
Q: How do I make an offer to
purchase and what happens after I place a
bid?
We as your HUD-registered real estate agent or broker
will place an offer in the form
of an electronic bid on your behalf.
If your bid offers the highest price, net of
closing costs and commissions, above the minimum acceptable price, then the bid
will be acknowledged, assuming all other considerations are met.
The bid will be the acknowledged bid
listed in "Bid Results," allowing your agent or broker 48 hours to deliver a
complete contract package to the appropriate Regional Office the complete and
signed Sales Contract package with all addenda, a copy of the loan
pre-qualification letter, and your earnest money check.
Only when a complete and correct contract
package is submitted and received on time will the HUD
Contractor sign on behalf of HUD as Seller.
Otherwise, your bid may be cancelled
and the property may be offered to the next highest acceptable bidder or it may
be placed back on the market for others to bid.
Q: How do I start the process of
buying a HUD home?
Our agents can help you get pre-qualified for
a loan, show the available homes to you, write a Sales Contract for you to sign
and place an offer by electronic bid on your behalf.
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