Nonsense! I just attended a class on "Successfully Selling HUD Homes" at our local MLS and what an eye opener. In my career, I had only submitted 1 electronic offer and it was very stressful. I didn't know what I was doing - it was the blind leading the blind. To be honest, I didn't feel that I had represented my client to the best of my ability. This class was very educational. I am now prepared and have the confidence and resources to tackle the job!
What is a HUD home?
• A foreclosed FHA loan
Who can buy a HUD?
• Any qualified purchaser
• Must be pre-qualified
Who can sell a HUD?
• Any licensed real estate broker/agents
• Must have an NAID #
Just a few AHA's:
• Each HUD home is appraised by an FHA appraiser. This dollar amount is the initial list price you will see posted.
• Each home has a Property Condition Report but should not be used in place of an inspection. Obviously, it is recommended that all buyers get an inspection. The utilities can be turned on at the buyer expense.
• Earnest money requirements: $500 for properties listed up to $50,000 or less and $1,000 for properties over $50,000. The EM is payable to HUD in certified funds.
• If you have an FHA buyer, they must use HUD's appraisal which is free to them. Should your client elect to submit an offer for more than the appraised list price, the buyer would have to pay the difference in cash at the closing table (FHA will not loan more than the appraised amount). We need to be sure to educate our clients on this beforehand.
• All owner-occupants must live in the house as their primary residence for at least one year and may not purchase another HUD home for 2 years. Anyone else is considered an investor.
• The penalty for an owner-occupant vacating the home prior to the first year is 2 years in jail or a $250,000 penalty (pretty steep!)
There is much, much more to learn about the HUD home selling process. Be sure to visit http://www.southwestalliance.com for additional information on buying and selling HUD homes.
P.S. I'm never too busy for your referrals! I look forward to working with you soon!
P.S.S. To verify any of the information above, you may call 800.934.3009