Buying a Department of Housing and Urban Development (HUD) house is an excellent homeownership opportunity. And while they're typically purchased by low to moderate-income people, anybody can buy them.
For example, HUD has special purchase programs for educators and law enforcement officers. Specifically, teachers, police officers, and others receive special housing incentives to purchase homes in specific neighborhoods and communities.
So, if you're a savvy buyer, you can get an outstanding deal on a HUD foreclosure!
Don't have perfect credit?
You don't need to worry about it, as HUD Repos are not limited to buyers with perfect credit.
You can purchase a home with government assistance even if you have fallen on hard times or have less than stellar credit.
Let's take a quick peek at HUD Foreclosures available in your area, which you can do by clicking on the following link. Then, search by state, county, city, zip code, etc. Here's a link to find Available HUD Homes
When you find a home, a HUD-approved real estate office can show it. The link above will also point you to lists of approved offices.
When you meet with an agent, finding a HUD home is the same as finding any home. Meet and then tell them what you want in a home. The agent will then get to work looking for one that meets your needs. It's that simple!
A HUD property becomes available when a homeowner with a HUD-insured mortgage cannot make payments. At that point, it is foreclosed.
Next, HUD pays the lender what is owed on the properties and takes possession of them. HUD then auctions them off, sometimes for less than the appraised market value. Hence, it is why you buyers can find such great deals on HUD homes.
The auction is considered the "offer period." Everyone places their bids, and the highest bidder gets the house. HUD will contact your agent within 48 hours if your bid is approved.
If your bid wins, your agent will help you with the paperwork. Your settlement date will usually fall within 30-60 days of your winning bid. It is important to remember that you cannot finance a home through HUD.
Consequently, it's essential to have your financing and arrangements with everything ready to go when you place your bid. You may lose your deposit if your bid wins and you do not close.
If the home needs repairs, the responsibility falls on you - the buyer. HUD homes are sold "as is" and do not come with a warranty, nor will HUD make any repairs. However, the price of the home is always adjusted downward to reflect the cost of repairs.
Only consider buying a HUD Repo if you are willing to absorb the cost of repairs. However, the repairs might be minor in many instances, so don't turn down a good home because it needs a little work.
Before looking for homes, you should determine what you are willing to spend on repairs and stick to it. Consequently, having the home inspected before making an offer to assess the cost of repairs is essential.
Suppose you are purchasing a HUD home as a real estate investment. In that case, you cannot bid during the initial offering period because families needing housing receive priority over all others. Therefore, the initial offering is only available to buyers who intend to live in the home. If no one bids on the house, investors can then bid on it.
Finally, suppose HUD foreclosure listings don't sell within six months. In that case, HUD will then sell them to charities or agencies to provide housing for needy families. Ultimately, the homes will likely end up with those individuals needing them the most.