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Old 07-24-2012, 12:29 PM
 
Location: Not where I want to be.
1,189 posts, read 1,463,070 times
Reputation: 2009

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Has anyone ever purchased a HUD home? If so, what is the process and how long did it take to actually get the keys? What is needed at auctiona nd can you finance or do you need the full amount remaining on the house?

A friend of our suggested we go this route to get a more affordable house in a decent neighborhood and we can fix it up along the way. There were a couple of HUD homes in our friend's (very nice) neighborhood that just needed some TLC.
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Old 07-24-2012, 12:33 PM
 
Location: Salem, OR
13,740 posts, read 31,556,293 times
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Quote:
Originally Posted by Flamingomo View Post
Has anyone ever purchased a HUD home? If so, what is the process and how long did it take to actually get the keys? What is needed at auctiona nd can you finance or do you need the full amount remaining on the house?

A friend of our suggested we go this route to get a more affordable house in a decent neighborhood and we can fix it up along the way. There were a couple of HUD homes in our friend's (very nice) neighborhood that just needed some TLC.

Yes you can finance. You have to go through a real estate agent as they have to have a NAID number in order to enter the bid online for you. HUD writes contracts for 45 days. That is their policy. I have found they use the full 45. They require $1,000 in earnest money on most homes. On the HudHomeStore site, they state if a house is financeable with FHA or not. Find a local agent that has been trained in the HUD process. It is fairly straight forward but it is different from the regular real estate process.
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Old 07-24-2012, 12:39 PM
 
Location: Not where I want to be.
1,189 posts, read 1,463,070 times
Reputation: 2009
Quote:
Originally Posted by Silverfall View Post
Yes you can finance. You have to go through a real estate agent as they have to have a NAID number in order to enter the bid online for you. HUD writes contracts for 45 days. That is their policy. I have found they use the full 45. They require $1,000 in earnest money on most homes. On the HudHomeStore site, they state if a house is financeable with FHA or not. Find a local agent that has been trained in the HUD process. It is fairly straight forward but it is different from the regular real estate process.
Thank you so much! I knew the process was a bit longer, but that really isn't too bad at all. I do check the HUD site frequently, but so far, nothing in the area we are looking, but it seems new homes pop up every few days. not too much info there about the process, so I appreciate your help.
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Old 07-24-2012, 12:49 PM
 
Location: Salem, OR
13,740 posts, read 31,556,293 times
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Here is the process in a nutshell

1) Find buyer agent who has a NAID number
2) Find a HUD house
3) Enter Bid online, sign contracts, and write check for $1,000 for earnest money
4) If bid is accepted, you have 48 hours to get the contract and earnest money to HUD. Yes, your agent has to pay $50 to overnight it.
6) Once they confirm receipt they will email your agent a copy with signatures, executing the contract
7) Your agent calls the asset management company and is given a 72 hour window to set up the home inspection. Depending on season you may have to pay a $150 winterization fee. If the house is pre-1978 HUD will do a lead paint test if you are doing an FHA loan.
8) You inspect. If it looks good your lender orders the appraisal.
9) After appraisal you go to underwriting like a regular loan.
10) Your lender needs to have docs at escrow about a week before closing. You sign, then the docs go to HUD.
11) HUD needs 3-5 days from the time they get those docs to process them.
12) You close and get the keys.
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Old 01-27-2013, 02:30 PM
 
6 posts, read 9,166 times
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Couple of points:

If List Price below $50,000 then earnest money is only $500

Any FHA loans need to use HUD's appraisal unless there is significant repairs needed or 4 months has transpired since appraisal

You don't get the keys, because none gets the HUD key.. agent gets you access and you change locks.
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Old 01-27-2013, 02:40 PM
 
Location: Austin
7,077 posts, read 16,889,211 times
Reputation: 9484
Quote:
Originally Posted by Silverfall View Post
Here is the process in a nutshell

1) Find buyer agent who has a NAID number
2) Find a HUD house
3) Enter Bid online, sign contracts, and write check for $1,000 for earnest money
4) If bid is accepted, you have 48 hours to get the contract and earnest money to HUD. Yes, your agent has to pay $50 to overnight it.
6) Once they confirm receipt they will email your agent a copy with signatures, executing the contract
7) Your agent calls the asset management company and is given a 72 hour window to set up the home inspection. Depending on season you may have to pay a $150 winterization fee. If the house is pre-1978 HUD will do a lead paint test if you are doing an FHA loan.
8) You inspect. If it looks good your lender orders the appraisal.
9) After appraisal you go to underwriting like a regular loan.
10) Your lender needs to have docs at escrow about a week before closing. You sign, then the docs go to HUD.
11) HUD needs 3-5 days from the time they get those docs to process them.
12) You close and get the keys.
It's interesting that even HUD homes can be area specific, depending on what main asset company is handling the transaction. In Texas, the docs have to get to HUD 72 hours in advance. They approve everything, and then the buyer signs and they table fund because the lender has to send their money prior to the signing. There is no wait time between buyer signing and them getting access to the house.

Also, the buyers have to contact the asset company themselves with a form they have to fill out and sign along with a fee, no matter what season it is. And sometimes it's refundable, and sometimes it's not. After inspections, the buyer has to fill out and sign another form acknowledging they are done and the house can be rewinterized.

It's a long process and the buyers do a lot as they are the ones who have to set up all the utility companies and pay deposits just for inspection, and then call them all back to turn everything off when complete.
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