Who can buy a HUD Home?
Find Purchase Forms Here:
http://tempuri.org/tempuri.html
* Individuals and investors, HUD-approved non-profit
organizations or government entities
* Priority is given to owner-occupants
* Buyers can secure a loan or pay cash to secure real
estate
* Pre-approval letter from lender or proof of cash funds
is required
What costs does HUD pay?
*
HUD
will pay up to 3% of buyers closing cost (must be negotiated in contract)
*
Escrow
fee paid by HUD (savings of anywhere from $350-$900)
*
Price
of home is based on an FHA as-is appraisal (excellent values)
*
FHA
appraisal is already completed (saving an average of $400, Appraisal is good
for up to 4 months)
What is the process?
*
Purchaser(s)
must have a pre-qualification letter or pre-approval letter from a lender
*
If
this is a cash sale, verification of cash funds is required
*
Please
have this documentation prior to
placing your bid
*
Depending
upon the condition of the house and the mortgage amount, an FHA 203(b) loan or
an FHA 203(k) loan may be used
*
Buyers
may also obtain conventional financing or pay cash
*
Sales price of
$50,000 or less, the EMD is $500
*
Sales price of
$50,001 or more, the EMD is $1,000
*
For vacant lots
or sales less than $500, the EMD is 50% of the sales price
* After Contract Ratification:
*
Ratified contract
and EMD sent to HUD designated closing agent
*
Buyer arranges
with the selling broker to conduct a home inspection (optional)
*
Buyer finalizes
financing
What are the next steps?
*
It
is recommended that the purchaser retain the services of a home inspection
company
*
The
purchaser has 15 days from contract
ratification to conduct a home inspection
*
Utilities
may be turned on for up to 72 hours for buyer’s inspection, at buyer’s expense
*
Deposits
and fees for activating utilities may be required
*
Please
don’t wait to do this inspection, get it done first thing
*
15
day inspection is not a free pass (not a contingency to the contract)
When does the sale close?
*
Either
sale closes at Closing Agent’s office or package is emailed out for signatures
*
Title
transferred to new owner
*
Buyer
is responsible for rekeying the property after the close of escrow
For more information visit: http://tempuri.org/tempuri.html