Home Buying in 55407>Question Details

Dobie, Home Buyer in Elk River, MN

I have heard that some real estate profs are putting in offers on hud homes with no intention of fulfilling the purchase.

Asked by Dobie, Elk River, MN Wed Dec 14, 2011

To get other truly interested parties to increase offer at a later date.

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If the realtor who is putting up the offer and knew that the buyers will not fulfill their obligations, then the realtor could loose the licence. And th buyer will loose their earnest money which is in form of cashier check.
0 votes Thank Flag Link Thu Jul 18, 2013
I don't know of any personally that work that way. I know if I put in a hud offer for a customer they want that property.
0 votes Thank Flag Link Wed Dec 21, 2011
Hi, Dobie!
I'm not sure what you mean here. Are you talking about the real estate agent actually PURCHASING the property themselves or that they are acting on behalf of a BUYER?

If the agent is submitting the offer for themselves, they most likely would not be submitting an offer for a HUD home with no intention of carrying through. It begs the question "WIFM", What's In it For Me! In other words, there's no pay off in doing all that work with no intention of carrying through.

And, if they are submitting the offer on behalf of a buyer, it's the buyer who dictates what's going in to the offer, not the agent. The agent is working to make a deal stick, so again, there's no incentive there for the agent to mess up acceptance of an offer on purpose. Make sense??

Good luck!
0 votes Thank Flag Link Wed Dec 21, 2011
HUD homes as well as all foreclosed properties are in a very competitive market. Those who are indecisive, hesitant, pad the offer with contingencies, and submit weak offers rarely purchase a home. These folks do not believe the real estate professional who advises making a strong, clean offer quickly. It is these frustrated buyers who want to believe there exists some grand conspiracy that prevents them from buying a home.

It just isn't true. HOWEVER, there are strategies for purchasing HUD and foreclosed homes that are highly appropriate for situations that are not exclusive to end user purchases. Very often when you read on Trulia a solicitation for "Hardworking real estate agent needed to submit bids for investors" you are witnessing the strategy in place with which a consumer must compete. For HUD homes, the first ten days as exclusively for the purpose of buyers who intend to live in the home to submit a bid. These bids will receive preferential review. It is not a grand conspiracy that stands between a purchase of these homes by a end user, but it is their indecision that proves detrimental.
Web Reference: http://www.MyDunedin.com
0 votes Thank Flag Link Thu Dec 15, 2011
I agree that this is unlikely to be occurring for ethical and legal reasons but there are unethical and illegal agents out there... just like in any industry. The The Twin Cities has seen a huge drop in foreclosure listings in the last 12 months so multiple offers are already very common.
Web Reference: http://www.SoCalCasas.com
0 votes Thank Flag Link Wed Dec 14, 2011
My parents always told me, "don't believe everything you hear..and only about half of what you read". While this type of thing may make sense if a person is bidding on their own auction on ebay, I can't imaging a scenario where there would be any benefit for an agent to make an offer on a HUD home when the agent has no interest in purchasing it. Driving up the price provides no benefit to anyone other than HUD, and most Realtors aren't much interested in that type of thing.

My advice to you is that if you are interested in purchasing a HUD home, get an experienced agent to help you, and toss in your best offer after carefully looking at the property. Many HUD homes require some work but they can represent some very good values.

If I can help, let me know.
0 votes Thank Flag Link Wed Dec 14, 2011
Each day (after 10 days on the market) all bids are checked on the HUD site. Wouldn't serve any purpose to do this as the bids would have to be considered and either accepted or rejected. This would also violate the Realtor code of ethics, which states we are to be honest in all matters. The way the HUD system works, agents can see if other offers have been submitted, which can benefit you, the buyer. If you know there is another offer, you may choose to increase your bid on a home you want.
0 votes Thank Flag Link Wed Dec 14, 2011
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