Hi Ashley....yes, people bid on HUD properties. The question is what would consttitute an acceptable bid...a realtor can do some research here to help you with what typically is the ask price vs. what the sold price actually is. There are certain restrictions on when an occupant may bid vs an investor. There are also certain requirements which must be met in terms of being prequalified for a mortgage, format for submission of the offer, etc. There is more information available at HUD.GOV. A realtor qualified in HUD foreclosures would be an excellent resource in guiding you through the process.
Hood luck in your home search!