1) What is HUD?
A HUD home is a 1-to-4 unit residential property acquired by the U.S. Department of Housing and Urban Development as a result of a foreclosure action on an FHA-insured mortgage. HUD becomes the property owner and offers it for sale to recover the loss on the foreclosure claim.
2) How can I search for a HUD property in my area?
Visit HUDHomestore.com. From the map on the home screen, click the state on the map or select it from the list. You can also search by price range, number of bedrooms and bathroom, and property status.
3) Where do I go if I have questions about a HUD Home?
Contact the local Listing Broker for the property or your Selling Broker.
4) How can I find out if I’m eligible to buy a HUD property?
For individual purchases, you must have a valid SSN or EIN to purchase a home. Owner-occupants are not eligible if they have purchased a HUD property in the past two years.
5) Can I bid on HUD Homes myself?
No you cannot put in an offer on a HUD Home by yourself. HUD requires that all bids must be submitted through an authorized HUD broker. You must use a Selling Broker who is licensed to sell HUD Homes to represent you. (Madden Real Estate is an authorized HUD broker).Bids can be submitted any day of the week, including weekends and holidays. They will be opened the next business day. If your bid is acceptable to HUD, your real estate agent will be notified, usually within 48 hours.
6) What is necessary to submit a bid?
An earnest money deposit must be from Federally Certified Funds. A USPS money order is recommended.
7) What are my financing options?
You can use FHA or conventional financing to purchase a HUD home. You may also purchase a property with cash.
8) Does HUD give money for repairs to the property?
No. However, a home buyer may wish to utilize an FHA 203K streamline loan to finance repairs on the property.
9) Can I make repairs to the property prior to purchase?
HUD properties are sold as-is with no warranty. No repairs should be performed on a property until after the new owner has taken possession of the property.
10) What happens to my bid once it is submitted?
The bid will not be reviewed by the Asset Manager until the Bid Open Date, which is the day after the Bid Submission Deadline. During the review process, the Asset Manager determines whether they will accept or reject your bid.
11) Can I modify or cancel an offer once it has been submitted?
Yes, you can modify or cancel an offer up until the bid-opening date. You are not able to modify or cancel an offer after the bid-opening date has passed.
12) What is an Asset Manager?
The HUD contractor responsible for marketing and selling HUD-owned properties.
13) Can I buy a home for investment purposes?
Yes. However, during the initial listing, owner-occupants get priority. If an owner-occupant does not bid on the home, then investors can bid on the home.
14) What are the advantages of buying a HUD property?
The government guarantees the title is clean. You also can actually visit the property and see what you are buying, unlike an auction.
15) What kind of condition are HUD Homes in?
They condition varies. In some cases, the property condition is excellent and requires no repairs. In other cases, the property may need cosmetic work, foundation repairs, fixtures and appliances replaced because they could be missing. However, the list price is supposed to reflect the fact that the buyer will have to spend some money on repairs.