|
Buying a HUD Home
When someone with a Federal Housing
Administration (FHA) insured mortgage can't meet
the payments, the lender forecloses on the home;
FHA pays the lender what is owed; and then the
United States Department of Housing and Urban
Development (HUD) takes ownership of the home.
Then HUD sells it at market value as quickly as
possible. Michaelson, Connor & Boul, Inc. (MCB)
is a Marketing and Management contractor for HUD
1 to 4 unit residential properties. MCB
maintains and sells these properties in
accordance with HUD guidelines. We know you may
have several questions regarding the purchase of
a HUD property. We want to provide you with as
much information as possible to assist you with
your purchase.
Any individual who can qualify for a mortgage or
who can pay cash may purchase a HUD home.
Purchasers must use a broker or agent who is
registered with HUD to place a bid on a
property. Purchasers must also have a
pre-qualification letter from a lender or proof
of cash funds in the amount of or greater than
the property they are purchasing.
All HUD Homes are listed on our website at their
"AS-IS" fair market value. Purchasers (with the
exception of special program purchasers) must
obtain the services of a HUD Registered Real
Estate Agent. Agents may submit bids on HUD
properties on behalf of their buyers. The bid
that meets the acceptable threshold and has the
highest net to HUD receives a provisional bid
acceptance subject to receipt of all required
documents. Once a bid is accepted an original
Sales Contract Package must be submitted to MCB
with 48 hours.
Fair Market Value is determined by a licensed
FHA appraiser. Copies of the FHA appraisal are
available to the lender by request after a
property is under contract. If a property is
exposed to the market without any acceptable
offers then a reduction of the listed price may
occur.
No. All HUD properties are sold in
their "AS-IS" condition. There are no
representations or warranties, expressed or
implied, on any HUD property. HUD does not
guarantee the condition of any property,
FHA-insurable or not, nor whether it meets local
codes or zoning requirements. Purchasers are
advised that there may be code and/or zoning
violations on these properties and that it is
the responsibility of the purchaser to identify
these violations. Buyers are very strongly
encouraged to have homes inspected by a
qualified home inspection company to satisfy
themselves as to the condition of the property
at the time of sale.
Owner Occupant and Investor purchasers
MUST be accompanied by a broker or agent when
viewing any HUD home listed for sale. Buyers may
not enter a house without their broker/agent for
any reason prior to closing. Brokers and/or
agents must accompany any individual performing
services such as home inspections, appraisals,
or certifications. Brokers and agents may only
use their keys for their own legitimate use.
Keys are not permitted to be lent to any other
individuals associated with any sales
transactions.
No work is to be done to ANY HUD property prior
to the close of the transaction. An accepted bid
is NOT a transfer of ownership. Purchasers do
not own the home until it is recorded in their
name. Purchasers may not use the home for
storage of personal items or occupy the premises
under any circumstances. Occupying or working on
a HUD home prior to the close will be treated as
trespassing. Failure to abide by this policy can
result in the cancellation of the sale
transaction, forfeiture of the earnest money
deposit and may also involve suspension of
bidding privileges for the selling agent and
brokerage firm.
|
Bidding on HUD
Properties
All HUD Homes
that are available for
sale are listed on our
website and on the MLS.
If a property has an
accepted bid or is under
contract it is removed
from the web listings.
Only HUD-registered real
estate agents can place
bids on behalf of their
buyers. For a bid to be
awarded it must meet the
threshold for the
property (lowest
acceptable amount) and
have the highest net to
HUD (not purchase
price). A sales package
should be completed at
the time of bid
submission. Once a bid
is accepted the
purchaser and real
estate agent have only
48 hours to submit the
Sales Contract Package
to MCB. If the sales
package is not received
within the deadline then
the bid acceptance may
be cancelled. If there
are no acceptable bids
placed on a property
then it remains on the
market until an
acceptable bid is
received.
During the
first 10 days a property
is listed it is
available for Owner
Occupant Purchasers
only. All bids placed by
Owner Occupants that are
submitted from Day 1
through Day 10 are
opened on the 11th day
and are considered as
though they were
received simultaneously.
If there are no
acceptable
owner-occupant bids on
day 11, then bidding
becomes available to all
purchasers on a daily
basis.
Bids are reviewed for
acceptability on the
following business day
after the deadline of
bid submission. Our
established time to post
bid winners is no later
then 4:00 pm Eastern
time. It is possible
that on the day you
submit a bid, we have
not yet completed our
review of the bids
submitted the day
before; therefore, it
may appear that the
property is available
and that you have
submitted a higher
bid.Please do not submit
bids until after 4:00 pm
EST by which time all
bid winners have been
posted for that day. All
bids are accepted based
on HUD’s guidelines and
followed with no
exceptions.All bids
submitted for Owner
Occupants are displayed
on BID STATISTICS which
is updated every Friday
for bids submitted the
previous week. The bids
submitted in the current
week are not displayed
until the following week
due to Owner Occupant
bid submission
deadlines.
Bids submitted for an
investor are displayed
on BID STATISTICS which
is updated every Friday.
The Results from the bid
review process will be
posted on our Web Site
by 4:00 PM EST.It is the
responsibility of the
Agent to check the BID
RESULTS page on our web
site for the accepted
bid information and
ensure that all the
required forms are
properly filled out and
sent to us by overnight
mail. These forms are to
reach us within 48 hours
from the time of the
provisional offer. As a
courtesy we also notify
the Agent by e-mail and
fax using the
information entered
during the bid
submission. Please note
that incomplete
information will not
enable us to notify you.
DO NOT WAIT FOR OUR
E-MAIL OR FAX TO SEND IN
YOUR COMPLETED FORMS
If a bid has been placed
on a property with
incorrect information or
by mistake it is very
important that a
"Cancellation Request
Prior to Acceptance" is
submitted to avoid award
of the incorrect bid.
This can be completed by
your real estate agent
and the form is
available online.
In the event that a
purchaser is awarded a
bid but does not want to
proceed with the sales
contract package on the
property then a
"Cancellation Request
After Bid Acceptance"
must be submitted
immediately. The
property will then be
cancelled and re-listed
the Friday following the
completion of the
cancellation processing.
|
|
|
|
