HUD Homes offer many advantages to home buyers
A HUD home is a home that had a FHA loan which is insured by FHA and when the lender takes possession after default, the lender turns over ownership to HUD.
HUD then resells the home. Buyers through registered realtors bid for properties online and owner occupants have a 10 day exclusive bidding period.
There are many benefits to buying a HUD home such as:
- Up to 3% of closing costs paid if negotiated in the contract.
- The escrow fee is paid by HUD which can equal a large savings.
- A condo or townhome doesn’t have to be in a FHA approved community to get a FHA loan.
- FHA appraisals are good for 4 months up to a $400 savings if used.
- Escrow repairs up to $5000 can be included in a repair escrow.
- During the exclusive period owner occupants don’t compete with investors for HUD homes.
- There is only a $1000 deposit for most HUD homes in the area.
- HUD pays for section 1 termite clearance with FHA financing in California.
- Many HUD homes qualify for FHA 203(K) financing if they don’t qualify for regular FHA financing.
So if you are looking for a foreclosure a HUD is worth consideration. They even make sense for investors too in many circumstances. For a free list of HUD homes in your area please feel free to contact me.
