5 Things You Should Know Before Buying HUD Homes

For sale HUD Homes: What You Should Know Buying a HUD home

The HUD homes for sale are FHA insured loans that were foreclosed and HUD has taken the ownership of the HUD Property. To make a profit out of it, HUD then assigns the HUD home to a Management and Marketing Contractor which will then clean and beautify the house and will have it appraised by and FHA appraiser.

Different rules apply when buying a home and a HUD home. This is for those who wants to buy a home and not for investors. These are the five things you should know before you make a bid in buying HUD homes.

1.   Anyone can buy a HUD home that’s for sale as long as you can get a mortgage or you have the money. There are no restrictions on who can buy HUD homes.

2.   You should take responsibility in making your own financing arrangements by having your loan pre-approved. A pre-qualification letter from your lending company or proof of cash is needed that is greater than the HUD homes you are buying. The HUD will not do your home so you can purchase HUD homes for sale.

3.   Be sure that you want the HUD home you are buying because a HUD home is sold in an as-is condition. What you see is what you get. Unlike in buying a regular house which you can do a meticulous inspection in almost everything, in buying HUD homes, you are not permitted to do a full inspection. A contract should be signed and accepted before you can test and inspect everything.

4.   There is an earnest money requirement which differs depending on the list price of the HUD home. However, if you don’t like the HUD home listing, the return of the earnest money is not automatic.

5.   You need to have a real estate agent in order to place your big on HUD homes for sale. You should choose a trusted and experienced real estate agent in buying HUD houses. Because if you pick the wrong real estate agent, you will be wasting a fortune.

Porama Srijinda, MBA.

REALTOR®, CIPS

Broker Associate at Keller Williams Realty.

Authorized HUD  Agent. Short Sale and Equator Experiences,

Ca. DRE. Lic# 01838443