A HUD home is a 1-to-4 unit residential property acquired by the U.S. Department of Housing and Urban Development as a result of a foreclosure action on an FHA-insured mortgage. This means they must have a NAID registration number and be registered in the HUD database. I’ve bought five HUD Homes as real estate investments and the fifth one was just this week. The M&M Contractors act on HUD’s behalf, but HUD retains the title to the home until it is sold.
Each lender has its own process for potential buyers to preview and then submit offers on its foreclosure homes. These properties offer the same low prices as owner-occupant offerings, and as a result HUD homes are some of the most sought after investment properties on the real estate market today.
The federal government, HUD, becomes the owner and offers the property for sale to recover the loss on the foreclosure insurance claim. Generally advertised under the heading, New Listings,” HUD wants the buyers of these properties to actually reside at that property for at least one year.
Use our HUD Home experties to help you win in the bidding process for HUD homes. Purchasing from HUD is different from purchasing from any other kind of owner, including a bank. Since the new owner will be responsible for making needed repairs, HUD strongly urges every potential homebuyer to get an inspection from a licensed professional home inspector prior to submitting an offer to purchase.
HUD will also generally pay any outstanding seller costs such as outstanding tax or utility bills which relate to HUD’s ownership. Certain groups are able to get special rates for buying HUD homes, including police officers, teachers and firefighters through the Good Neighbor Initiatives.