Are you experienced in the HUD home bidding and buying process?

Question

I'm about to place a bid for the 1st time on behalf of a client. My managing broker hasn't had experience with any HUD deals although our company is registered with HUD. I could use some more attentive detailed help I can't find. I've been showing HUD homes to a family. They've found one they'd like to bid on. I'd like this to go well for them - this is definetly a challenge for me as this will also be my 1st sale if our bid is accepted.
My questions are:
Do you get the inspection before you place the bid? Or do you set up the inspection just as soon as possible? We have viewed the home. It needs work of course.

Are all the general steps the same - do I need to order the legal from a closing company NOW... do yo know how that works?

If the deals are done electronically, how does that work as far as having the forms filled out in front of you?

Here's a broad, general question: beside being sure to write in my commission, what do I need to remember & be sure of?

THANKS!!

Answer 1

1 - Don't have your buyer pay for an inspection prior to winning the bid. You cannot have the utilities on anyhow until you win the bid and get permission. If your buyer is going to live in the house (not rent or flip it) then they can back out if the are getting an FHA loan, and there's a major problem with the roof, foundation, major plumbing or HVAC. Investors don't get that option.
2- Put the bid in yourself. Don't go to the BLB for them to enter it on the computer. This is a secret bidding procedure. You don't want the broker representing other buyers knowing what your bid is - you'll lose by $1 every time!!!!
3- In Texas, I've helped other agents put in HUD bids (as long as I don't have a buyer for the same property). Contact me if you're in Texas.
4- I'm not sure in other states, but here, the closing agent is picked by HUD's Marketing company - Southwest Alliance (used to be part of First Preston). They will do the title search. The mortgage company would contact them for title commitment.
5- If you win the bid, then you have 48 hours to get the ORIGINAL paperwork SIGNED IN BLUE INK to them (the website will tell you where your contract has to go). Include all the pages, plus a lender pre-qual letter (signed by loan officer, buyer and broker), and a copy of the cashier's check. The check will then go to the actual title company or attorney they've chosen to close the property.

Answer 2

My experience with HUD...

Your buyer always has the option of getting a home inspection at anytime, however, to avoid an unnecessary expense they may want to wait until their bid is accepted.

An inspection of the property is usually completed prior to HUD making the property available... you should have access to the full inspection report on the HUD Website, and this will assist you in getting information regarding the structural condition and needed or recommended repairs.

You may need to have the utilities turned on for certain inspections that the mortgage company may require, ie. water test if it has a well.

Closing is done the same as with any other sale... in our area it's usually done with a title company.

If the bid is accepted, you'll need to submit the forms with original signatures to the Regional HUD office.

This is some general information... I believe that HUD provides a workbook that is available on their website for download. You'll get most of your answers regarding the technical process from that workbook.

Good Luck.

Bill

Answer 3

HUD is pretty open and shut. It really does depend on the listing office that has the HUD listing. We have always tried to get the inspection done prior to making the offer to the listing office, assuming the inspection is acceptable to the buyer we then make our regular offer, the listing office then gets on the computer and fills out the required offer form by HUD then you get back the amendment to offer completed by the listing office with any terms change from the assigned employee of HUD. By agreement either office can make the arrangements with the title company.
HUD www.hud.gov/
HUD forms: Make sure that your broker has completed form #SAMS-1111 to get qualified http://www.hudclips.org/sub_nonhud/html/forms.htm
In case the property is rural:
HUD On site well and septic system testing requirements for loan approval*: http://www.hudclips.org/sub_nonhud/cgi/nph-brs.cgi?d=MLET&s1=95-$[no]&op1=AND&SECT1=TXTHLB&SECT5=MLET&p=1&r=25&f=G
They are pretty stingy on their prices
Buena Suerte

Answer 4

the residing house is going up on the marketplace and you're able to be able to make an supply. No provides are seen until eventually the time-era expires (apx 10 days). Then the triumphing bid gets the residing house. in case you bid under the asking cost, they do no longer ought to decide your supply, regardless of while you are the optimum. in case you bid the asking cost and win, you get it for specific. The brokers deliver interior the provides to an internet business employer ( mcbreo). you may never understand what share different bidders there'll be so which you're continually guessing. except you particularly want that one residing house, do no longer supply greater suitable than $40,000. The down cost is $one hundred for some residences. in case you do choose it, supply $50,000 and get it.