As you can see from recent posts, HUD homes are the same as foreclosures; however the process is slightly different because with foreclosures generally those are now with the bank and HUD which stands for Housing Urban Development is owned by government agencies. Fannie Mae offers a "Home Path" program and will even go into these distressed properties and do some repairs to bring the home up to a livable standard. The best advice to give you is to do your homework on the neighborhood and compare this home to other homes in the area that have recently sold. Also, getting a thorough inspection is a MUST so you are not surprised with large repair bills. HUD homes will typically have a property condition report which is helpful; however do not only go off that information because that inspection is done fairly quickly. Having a licensed inspector will save you time, money and energy down the road. You can find some "diamonds" out there but you have to do your research and find a reputable agent to work with. If you ever have any questions, please do not hesitate to call me.
Many HUD Foreclosures are overpriced initially and get lowered over time. The same goes for foreclosures. All of these homes hit the MLS and that is where they are seen buy potential buyers in the highest numbers. There is no magic bullet for finding great deals. Sellers whether they are individuals or banks want the highest dollar they can get. It's your job along with your agent to understand the market and know what a good deal is no matter what the source or seller is.
Hope this helps.
REALTOR® | Mortgage Broker
Keller Williams Realty | 360 Lending Group
o 512.669.5599 m 512.633.4157
firstname.lastname@example.org | http://www.AustinListed.com
There are HUD properties that are priced very competitively and aggressively than other foreclosed homes owned by the banks. And most of the time, in my market, the offer accepted is higher than the asking when the property is priced aggressively. This is normally the case in my local market.
One advantage in dealing with HUD-owned homes is that appraisal has been performed prior to listing. Hence, PCR(property condition report) is available for review.
A big disadvantage though is for the investors because the earnest money deposit required ($500.$1000) is automatically forfeited even if home inspection report reveals defects or substantial damage. However, investors are pretty much savvy in assessing the condition of the property and because of the price it is listed for and what the investor could potentially pick it up for, he is more than willing to take the risk.
There are also conditions or parameters set when EMD (earnest money deposit) can't be refunded back to owner-occupied buyers.
Ulitilities activation is also the responsibility of the buyers. Not HUD's.
I don't discourage my buyers from looking at HUD properties because this can actually translate into an excellent opportunity for them.
Accredited Buyers Representative
Coldwell Banker Jane Henry, Realtors
Greed works both ways, pass on a good property just because it is distressed and you could be buying a ton of deferred maintenance. My experience leads me to believe that sellers do not usually default at the beginning of the problem, only after they reach the jumping off point. In the meantime the house suffers.
Not saying they should be excluded but neither should they be the primary target.
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Financing Kentucky One Home at a Time