HUD is the Department of Housing and Urban Development – a service wing of the US Government designated to help the American citizens in acquiring homes for living. Therefore the profit motive prevalent in other Real Estate companies is absent. Consequent to the foreclosure crisis sweeping the US nation, millions of home owners have become distressed lots, forfeiting their hard-earned housing properties to the foreclosure fiasco. Similarly, middle income group and lower income group of people to whom HUD is serving mostly in providing single family homes, multi-family residences, condominiums etc. are hard hit by the foreclosure tornado.
HUD is providing guarantee for the homes purchased by these people, which are insured by the Federal Housing Administration (FHA), at the time of securing home loans from mortgage lenders. In the event of the home owners default in repayment of the mortgage loan, HUD intervenes and pays off the balance outstanding on the mortgage loan and takes possession of the concerned property. These properties become HUD owned (indirectly Government owned) and are offered for sale to the public. These properties for sale can be purchased by any one who has the financial qualifications, subject to the terms and conditions adhered to by HUD. Priority is given to first time home buyers for own occupation for a certain period and then the HUD homes for sale can be allotted to other buyers including investors.
These homes for sale are available in all the States and so investors and home buyers have a wider choice to select the location, neighborhood, communities as well as the size and model of homes for sale to suit their needs. After selecting a suitable property from the list of houses for sale, which are available online and with Real Estate Agents, buyers have to submit their bid for the property through the divisional offices of HUD. Any HUD licensed Real Estate Agent (most of them are) can help you in finishing the home buying activity, right from submission of bid to finalizing the deal squarely without any loose ends. The commission payable to these agents and brokers is also borne by HUD as part of the sale contract.
Prior to submitting a bid, HUD recommends the buyers to get a home inspection, since the properties are sold in “AS IS” basis only and HUD will not undertake any repairs or fix-ups on the properties. So in the interest of the buyers, they can get an inspection done to arrive at a fair value, after estimating the value of the required repairs and rehabs and make an informed decision on their bidding. Although HUD is not engaging in financing the home buying deal, most of the HUD homes are eligible for FHA-insured mortgage loans. As the mortgage loan is insured by FHA, lenders will be flexible in offering the best terms for the loan, mostly with Fixed Interest Rates. Another advantageous feature is buyers can get the cost of repairs and rehabs included in the mortgage loan for the specific property, which is based on the projected value of the housing property after the so called repairs and rehabs.
Thus HUD foreclosures with their advantages are ideal for first time home buyers and investors.
kevin simpson, has been working on foreclosuredataonline.com studying the foreclosures market, helping buyers on the finer points of foreclosure homes for sale. try to visit foreclosuredataonline.com and begin your foreclosed homes by state search.
kevin simpson, gm sales marketing, foreclosuredataonline.com
