HUD Buying Made Simple part 1

Purchasing a home that is government repossession is about the same as buying a “Fair Market” home. Fair market home is a sale that is not a bank owned short sale or anything other than the way it used to be.

First of all what is a HUD Home.  HUD stand for Housing and Urban Development, this is the government backed home loan backer.  When buyers get an FHA loan it is backed by HUD.

When a HUD home comes out on the market they are given to several different Broker agencies.  These are real estate companies that have relationships with the agency. They go through a process to bring them on the market and they are then listed. There are several ways the homes are listed:

·         As an Owner Occupied only (buyers that are going to live in the home)

·         Good Neighbor (only buyers that are certain employment types such as Fire, Police or teachers)

·         Municipality owners (cities or non-profits can buy to renovate for resale or rental programs for sometimes low income.

·         Finally if the homes are not sold within the first month or so they are opened up to investors

HUDs goal is to make the homes available for owner occupation.  They are not like short sales or bank owned homes that most of the time sells below market value.  They are in fact listed and sold usually at market value taking into consideration the condition of the home.

Part 2 will take you through the offer process.