Home Buying in Gray>Question Details

Beth, Home Buyer in 37343

How does HUD determine the As-is Value of a property?

Asked by Beth, 37343 Sat Feb 14, 2009

Is this amount based on an actual appraisal?

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Beth, In addition to the information and resource I just sent you, check out the HUD site for more about the process. The other thing I didn't mention is that on the Southwest Alliance site, you can find an agent near you who can help you with the bidding process, if you aren't already working with a licensed professional. If you are working with an agent, be sure to confirm he/she is registered to bid on HUD properties.
Web Reference: http://www.hud.gov/buying/
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The value is determined by the FHA appraiser who inspected the home. Additionally, pay attention to HUD listings where it is noted "insurable', "uninsurable" or states a $ amount and itemization for escrow. The FHA appraiser/inspector determines these things too. Basically, this information lets you know if an FHA loan would even be possible for that particular property. If a buyer were to pursue the purchase and requires FHA financing, the information under FHA Escrow indicates how much additional cash will be required to purchase the home with an FHA loan. Many buyers looking for the $100 down payment are sometimes surprised to learn that they would have to bring additional cash to be held in escrow for repairs in order to get an FHA loan to purchase one of these homes. If the HUD listing says "uninsurable" then the only options for purchase are cash or conventional financing. Southwest Alliance manages the bidding process for HUD properties in my area and they have a great site with information for agents to us to understand/discuss HUD purchases with your clients. I encourage you to check out the resource.
0 votes Thank Flag Link Sat Feb 14, 2009
HUD has property appraised by a state licensed appraiser who uses recent comparables. HUD Homes are initially offered to owner-occupant purchasers (people who are buying the home as their primary residence). Following the priority period for owner occupants, unsold properties are available to all buyers, including investors.

Using a real estate broker is a very good idea. All the details involved in home buying, particularly the financial ones, can be mind-boggling. A good real estate professional can guide you through the entire process and make the experience much easier. A real estate broker will be well-acquainted with all the important things you'll want to know about a neighborhood you may be considering...the quality of schools, the number of children in the area, the safety of the neighborhood, traffic volume, and more. He or she will help you figure the price range you can afford and search the classified ads and multiple listing services for homes you'll want to see. With immediate access to homes as soon as they're put on the market, the broker can save you hours of wasted driving-around time. When it's time to make an offer on a home, the broker can point out ways to structure your deal to save you money. He or she will explain the advantages and disadvantages of different types of mortgages, guide you through the paperwork, and be there to hold your hand and answer last-minute questions when you sign the final papers at closing. And you don't have to pay the broker anything! The payment comes from the home seller - not from the buyer.

By the way, if you want to buy a HUD home, you will be required to use a real estate broker to submit your bid. To find a broker who sells HUD homes, check your local yellow pages or the classified section of your local newspaper.
0 votes Thank Flag Link Sat Feb 14, 2009
Yes, a certified appraiser will value the property.
0 votes Thank Flag Link Sat Feb 14, 2009
Yes, a certified appraiser will value the property.
0 votes Thank Flag Link Sat Feb 14, 2009
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