How to Buy Government Foreclosures
Learn about HUD Foreclosures., Find HUD foreclosures., Participate in an HUD auction., Go through the purchase process.
Step-by-Step Guide
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Step 1: Learn about HUD Foreclosures.
Among homes available in HUD foreclosure listings are home foreclosures from the IRS, FDIC and Customs.
A common source of HUD foreclosures are when an owner defaults on a loan from the Federal Housing Administration (FHA).
The process begins when a homeowner with an FHA backed loan defaults on their mortgage.
After the home has been foreclosed on, HUD pays off the remaining debt on the homeowner’s FHA loan.
Now that the lender has been reimbursed, ownership of the property is transferred to HUD. -
Step 2: Find HUD foreclosures.
There are a number of ways to find HUD homes near you.
First, you can access the HUD homestore at http://www.hudhomestore.com/Home/Index.aspx.
This allows you to browse HUD homes by location and using a number of other criteria, like price, number of bathrooms, and number of bedrooms.
Once you've located a home, you will have to work with a qualified HUD real estate agent to move forward with the buying process.
The agent for the homes you want to look at further should be included on the listing for the home.
You may also be able to find HUD homes by going to a real estate agent in your area that specializes in HUD homes.
Try an online search for this type of agent in your area.
Finally, HUD homes are generally listed with other homes in newspaper or local magazine listings., The silent auction is the most common way that HUD sells their foreclosed properties.
During this time period, HUD approved agents will be accepting sealed bids on the property.
First time foreclosure buyers or buyers inexperienced in GOV foreclosures will want to hire HUD-approved real estate agents to make their bids for them.
For the first part of the bidding process, usually for 30 days, only "owner-occupants" may submit bids for the home.
These are people who would live in the home full-time, as opposed to investors or those who plan to "flip" the property for a profit.Offers made on the house can be either above or below the listing value, depending on market conditions.
Work with your real estate agent to determine a fair offer.
The HUD will have already had a professional appraisal of the house done.
The appraisal can be requested from the HUD so that you don't have to pay for one to use in financing the house., During the purchase process, you must secure financing for the house.
You cannot close on the sale without proof that you can actually afford the house.
You may be able to include the cost of any planned repairs or improvements to the house in your mortgage total.
You can work this out with a home inspector, who will then estimate the repair or improvement costs for you.
Do not be discouraged if your bid is rejected.
If you researched the home and remembered not to bid over your maximum pre-set amount, you’ll know that bidding any higher wouldn’t have been worth it.You may be able to secure FHA financing for your purchase.
These insured mortgage offer you some protection from default.You will usually have 30 to 60 days after your bid is accepted to secure and prove your financing and have the home inspected. -
Step 3: Participate in an HUD auction.
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Step 4: Go through the purchase process.
Detailed Guide
Among homes available in HUD foreclosure listings are home foreclosures from the IRS, FDIC and Customs.
A common source of HUD foreclosures are when an owner defaults on a loan from the Federal Housing Administration (FHA).
The process begins when a homeowner with an FHA backed loan defaults on their mortgage.
After the home has been foreclosed on, HUD pays off the remaining debt on the homeowner’s FHA loan.
Now that the lender has been reimbursed, ownership of the property is transferred to HUD.
There are a number of ways to find HUD homes near you.
First, you can access the HUD homestore at http://www.hudhomestore.com/Home/Index.aspx.
This allows you to browse HUD homes by location and using a number of other criteria, like price, number of bathrooms, and number of bedrooms.
Once you've located a home, you will have to work with a qualified HUD real estate agent to move forward with the buying process.
The agent for the homes you want to look at further should be included on the listing for the home.
You may also be able to find HUD homes by going to a real estate agent in your area that specializes in HUD homes.
Try an online search for this type of agent in your area.
Finally, HUD homes are generally listed with other homes in newspaper or local magazine listings., The silent auction is the most common way that HUD sells their foreclosed properties.
During this time period, HUD approved agents will be accepting sealed bids on the property.
First time foreclosure buyers or buyers inexperienced in GOV foreclosures will want to hire HUD-approved real estate agents to make their bids for them.
For the first part of the bidding process, usually for 30 days, only "owner-occupants" may submit bids for the home.
These are people who would live in the home full-time, as opposed to investors or those who plan to "flip" the property for a profit.Offers made on the house can be either above or below the listing value, depending on market conditions.
Work with your real estate agent to determine a fair offer.
The HUD will have already had a professional appraisal of the house done.
The appraisal can be requested from the HUD so that you don't have to pay for one to use in financing the house., During the purchase process, you must secure financing for the house.
You cannot close on the sale without proof that you can actually afford the house.
You may be able to include the cost of any planned repairs or improvements to the house in your mortgage total.
You can work this out with a home inspector, who will then estimate the repair or improvement costs for you.
Do not be discouraged if your bid is rejected.
If you researched the home and remembered not to bid over your maximum pre-set amount, you’ll know that bidding any higher wouldn’t have been worth it.You may be able to secure FHA financing for your purchase.
These insured mortgage offer you some protection from default.You will usually have 30 to 60 days after your bid is accepted to secure and prove your financing and have the home inspected.
About the Author
Daniel Stokes
Experienced content creator specializing in cooking guides and tutorials.
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