Buying HUD Homes
Century 21 Best Properties is an authorized brokerage for submitting bids on behalf of buyers for HUD (The Department of Housing and Urban Development) homes.
HUD HOMES
A HUD home is a property that was financed with an Federal Housing Authority (FHA)-insured mortgage where the owner has defaulted on the loan. Two FHA divisions you are probably familiar with are Fannie Mae and Freddie Mac. The lender forecloses on the home, FHA pays the lender what is owed and the lender transfers ownership of the home to FHA/HUD. In turn, HUD then sells it at market value. As with REO's and foreclosed propeties, HUD homes are sold "as-is"; however, there are a couple of notable differences in the purchasing process when compared to purchasing a foreclosed property.
First, a HUD home can be purchased with cash or you can obtain financing; one benefit that's not available when purchasing a property at a foreclosure auction. Secondly, rather than holding a live auction, the purchasing process is conducting by submitting a bid to the agency holding the property. You could be the only one bidding on a particular property, or there could be numerous bids placed; you just never know. When I purchased my home (a HUD home) back in 1997, I was the only one who submitted a bid on it.
Most HUD Homes are initially offered on a priority basis to owner-occupant purchasers (people who are buying the home as their primary residence). Following the priority period, unsold properties are then made available to all buyers, including investors.
What is a HUD Home?
A HUD home is a 1 to 4 unit residential property acquired by HUD 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.
Who can buy a HUD Home?
Almost anyone! If you have the cash or can qualify for a loan (subject to certain restrictions) you may buy a HUD Home. HUD Homes are initially offered to owner-occupant purchasers (people who are buying the home as their primary residence). Following the priority period for owner occupants, unsold properties are available to all buyers, including investors.
Click here to view HUD homes for sale in the Riverside County area
Click here to view HUD homes for sale in the San Bernardino County area
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How are HUD Homes sold?
All properties available for purchase by the public are offered for sale at Internet listing sites and maintained by management companies under contract to HUD. Any real estate broker registered with HUD may submit an offer and contract to purchase on your behalf. HUD pays the real estate broker's commission, if included in the contract.
Are there any special programs?
Properties in designated areas are available at a reduced sales price to law enforcement officers, teachers, firefighters, emergency medical technicians, nonprofits and local governments.
Should I get a home inspection?
We encourage you to get an inspection after your offer is accepted. All HUD Homes are sold AS-IS, without warranty. HUD will not make repairs nor pay to correct any problems.
What about financing?
Although HUD does not offer financing directly, some of our homes qualify for FHA-insured loans. Shop around for a lender to find the best loan terms.
Contact me to receive more information on how you can purchase a HUD home today. | |
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