Foreclosure in 75218>Question Details

Ed, Both Buyer and Seller in 75228

I am an investor looking at a HUD foreclosure. How does the bidding work after the 10-day priority period for owner occupants?

Asked by Ed, 75228 Sun Jan 31, 2010

Will they take thefirst bid received at or above the list price or will they wait for period of time to consider all bids? In other words, do I need to get my bid in at 12:00AM if the priority period expires at 11:59PM?

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They will take the highest net bid that meets HUD requirements on a daily basis. The amount of realtor commission affects the amount HUD will receive, but they are looking at the overall amount they will get. Regardless, you should discuss the commission your agent will put with the offer as many think 5% is the "norm". Since you're an investor, you should also be aware that you are at greater risk in losing your earnest money if you decide not to buy after they accept your bid.

I have a blog article that gives greater detail: http://www.kingrealtyteam.com/2009/12/15/buying-hud-owned-homes/
1 vote Thank Flag Link Sun Jan 31, 2010
Here is how it works and you need to be working with a hud approved agent:

There is a time frame in which the offer is updated on the computer.

After the deadline expires, hud contacts award the deal to the one that meets their requirements (if one meets their requirements).

If awarded the deal need to get offer expressed to the hud contactor within set time line.

They review information and determine if additional information is required and if it is that needs to be expressed to hud contractor.

After the docuements meet the hud contactor requirements it will take about 2 weeks to get signed contracts


It takes some time to go through the process. However, you got make sure you meet the time frames, even thought hud might meet the time frames.


Keith Manson
First Weber Group
Certified Distressed Property Expert
Metro Milwaukee

http://milwaukeebailout.com
2 votes Thank Flag Link Sun Jan 31, 2010
Ed,
In addition to the information you received below, please know that HUD is in the business of putting homeowners into properties, not helping investors make money. Keeping that in mind, HUD does accept all offers as a sealed, electronic bid. The following morning after the bid deadline, HUD will open all bids and choose the highest & best offer. However, if your offer and a competing home owner (occupant) have the same offer they will normally go with the owner/occupant over an investor.

Additionally, each time you make a bid you will need to have a cashiers check or money order for your earnest money prior to making your offer. If your offer is accepted, your agent must quickly get everything to HUD for signature including that money order. Earnest money will be either $500 or $1000 depending on the value of the home you are buying.

As noted below, if a home doesn't sell on the first bid deadline, it usually goes to daily bidding (meaning that the highest & best offers are reviewed daily for acceptance).

There are many other options for purchasing a home that may work for you. If you have a good deal of patience a short-sale may be a good option for you. I hope that this helps.

Melissa Hailey
Coldwell Banker Jane Henry Realtors
North Texas Top Team, Realtors
214-418-0180
Melissa.Hailey@ColdwellBanker.com
1 vote Thank Flag Link Mon Feb 8, 2010
Ed,
After the first 10 days if the HUD property does not sell, it is open for daily bidding and you will need at that point, if you so desire to bid, to go ahead and do so before the cut off time line in order to have your bid considered. I have successfully helped clients bid on and win HUD homes, if your interested in having representation through this, which I highly recommend doing with HUD, because there is a lot to navigate through if you are the winning bidder, throughout a 6 weeks process, and if you don't complete the steps on time you could possibly forfeit the house or money or cost yourself; contact me!

Nicole Arenas, Realtor
214.991.9507
1 vote Thank Flag Link Sun Jan 31, 2010
One of the agents in our office is the best I have ever seen at getting those bids submitted and accepted his name is Nathan and you can reach him through this e-mail which is connected to eveything-He is extremely reachable: so expect either an e-mail or a call today.http://mailto:Nathan@sellingtexastoday.com
0 votes Thank Flag Link Sun Oct 31, 2010
You can bid at anytime during the bidding process.

HUD will not announce winner of till after the cut off time period

Held electronic

HUD provides 48 window for an executed contract

If you don't win the bid agent will be notified

NOW if winner of bid choice decline property after inspection an automatic email alert will be sent out to agent you posted the bid determine if any interest.

Lynn911
0 votes Thank Flag Link Sun Jan 31, 2010
They set a bid deadline for final bid at midnight of that day. They then accept the highest net bid that meets HUD requirements submitted by that deadline. If there are no acceptable bids, they take daily bids on the property, first come first serve until they receive an acceptable bid. Once you receive acceptance and submit your earnest money, it may be at risk.
Michael Scott
214-507-2666
0 votes Thank Flag Link Sun Jan 31, 2010
Ed,

Cutoff time for bids is typically midnight, but you can bid before this. The earlier the better. Better for your agent not to wait until the last second as systems do go down, internet connections go down, etc.

I understand HUD takes the highest bid they get, but there is a floor or reserve price. So I think the answer to your question is no, they don't take the 1st bid over list. If there are five bids over list they would take the highest one. I understand they would consider all bids at the next cutoff time. They are time stamped, so for examle if there are 5 bids all for the same net amount to HUD, the one with the earliest timestamp would make it.

If you need assistance making the bid, please let me know. We are a HUD authorized broker and can place the bid for you. I can also show you the results of the bidding on other properties. That might make the bidding process make more sense.
Web Reference: http://www.teamlynn.com
0 votes Thank Flag Link Sun Jan 31, 2010
Bruce Lynn, Real Estate Pro in Coppell, TX
MVP'08
Contact
Basically the bids have to be on by that time and they do not look at any of the bids until the next morning. I have worked with investors on these and the best ones to go after are daily bids as you will normally not be competing against owner/occupants. HUD does give them priority. A realtor must put the bid in. The realtor has the option of attaching up to a 5% commission. Which effects your net offer. I never put 5% and do negotiate lower on competitive properties.

Don't hesitate to call
214-682-0598
RJ
0 votes Thank Flag Link Sun Jan 31, 2010
The bidding is held online and you must have a real estate license to enter bids. Those without licenses cannot bid on HUD properties. I doubt an agent would do it at midnight since there would be no one at the HUD offices to review the bid at that point. Doing it the next morning is more than fine; sending it in at midnight will not cause your contract to have first priority after owner occ - the contract that nets the most for the agency will have priority. I work HUD contracts and am at 214-695-3015. Thanks, Kim
0 votes Thank Flag Link Sun Jan 31, 2010
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