How To Buy A HUD Home
When it comes to buying homes, there are some options. Buying a HUD home is one of these options that a lot of people don't know about what they are and how they work. Below is a brief description on HUD homes and how they work:
HUD homes are homes acquired by the U.S. Department of Housing and Urban Development (HUD). If a foreclosed home was purchased with a loan insured by the Federal Housing Administration (FHA), the lender files a claim for the balance due on the mortgage. The FHA pays the claim, then transfers ownership of the property to HUD, which sells the home.
HUD homes are priced at fair market value for their location based on appraisal. Teachers and police officers are given a 50 percent discount on HUD homes. Investors often purchase HUD homes to fix up themselves and sell at a profit. HUD homes are sold as-is – HUD is not responsible for repairs and improvements.
You can view HUD listings on their Web site at https://www.hudhomestore.com/Home/Index.aspx. The HUD Web site lists registered HUD real estate brokers, because only they can show you a HUD property.
HUD foreclosures are sold using a bidding process. There's an Offer Period, during which sealed bids are accepted from agents. HUD accepts the highest bid offered. Unlike conventional home sales, there is no negotiating on price between buyer and seller.
Before submitting a bid, buyers must be pre-approved for financing.
The next time that you are exploring your options to buy a new home, make sure to look into a HUD home to find the best bang for your buck. It may take some work, but the rewards can be very promising.