HUD homes continue to offer opportunities for homebuyers and real estate investors.
HUD is an acronym for the Department of Housing and Urban Development, which obtains homes through foreclosures when the mortgages were issued by the Federal Housing Administration.
HUD properties are appraised, evaluated, priced competitively and offered for sale.
HUD homes initially are offered to purchasers who will occupy the home. After 15 days, however, unsold properties are available to anyone, including investors.
Available HUD properties are listed online at www.hudhomestore.com. Only real estate brokers registered with HUD may show properties and place bids.
HUD doesn’t warrant the conditions of its properties. Nor will the department pay to repair defects. Consequently, prospective homeowners are encouraged to get inspections from professional home inspectors.
When a homeowner wants to purchase a home in need of repairs or renovations, they usually have to obtain financing to purchase the home, then additional financing for the repairs and a permanent mortgage. Interim financing can involve comparatively higher interest rates and shorter amortization periods.
Those interested in purchasing a HUD home in need of repairs could apply for an FHA 203(k) rehabilitation loan.
This article was submitted by Ben Hill, owner of Hill & Homes in Grand Junction.