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HUD Homes: The Biggest Deal You Don’t Know About

November 17, 2014

HUD Homes: The Biggest Deal You Don't Know About

3 Important Steps to Remember Before Buying a HUD Home

Buying a HUD home is certainly one of the best real estate deals available. HUD homes are actually properties owned by HUD, the Department of Housing and Urban Development. These are homes where the owner failed to pay an FHA backed loan that resulted in foreclosure. These properties are now back on the market for sale, often at a great price.

However, before buying a HUD home here are three very important steps:

1.      Find an experienced Realtor. Purchasing HUD homes involves a lot of details; rules for investors vs home owners. When bidding on a HUD home homeowners that plan on occupying the home will have a slight advantage or real estate investors.  An experienced Realtor can guide you through the bidding process.

2.   Understand Your Financing Options. One of the most economical ways to purchase a HUD home is through the $100 down program. Conventional loans can also be used as well as 203-B programs or the 203k loans.

3.    Properties sold AS IS. Unlike typical homes for sale on the market where you may have the opportunity to negotiate for repairs cost. This is not the case with HUD homes. What you see is what you get. So do your homework, make a licensed contractor part of your team and make sure to get a honest estimate on repair costs. Some HUD homes only require minor cosmetic repairs. Other properties could have extensive and perhaps hidden repairs.  

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