New HUD Homes sales procedures announced
The HUD home buying process is certainly changing. Dan's blog below was quite an eye-opener. Some HUD changes sound positive but it will mean relearning a process that we have gotten comfortable with.
Lowering the 5% to 3% is certainly negative because of all the addtional work involved with a HUD. Perhaps this new process will lower the amount of hours a HUD contract currently requires.
Regards - Mark Hitz
HUD has announced several changes in the way HUD Homes will be sold. Here are some of the changes:
- Commission available to a buyers broker will be up to 3% instead of the previous 5%, but some lower-priced properties will have a commission of up to $1250 for the buyers broker.
- Days to close has decreased from 45 days to 30 days.
- Owner-occupants will have a bidding priority for 30 days on properties eligible for FHA insurance(Category IN and IE) instead of the present ten days. Simultaneous bidding will be for ten days, with bids reviewed on a daily basis after the initial ten days.
- Owner-occupants will have a bidding priority of 5 days on properties NOT eligible for FHA insurance (Category UI) instead of the present ten days.
- Bids from investors are considered when the property's owner-occpant priorty period is over.
- All information on properties nationwide will be on one website, hudhomestore.com
- New listings may come out on any day of the week instead of one designated day.
- There will be a procedure to allow open houses at HUD Homes.
- Earnest money will be held by HUD's designated closing agents instead of the broker.
- HUD will have multiple asset managers and field service managers in each state.
- The field service managers will start implementing use of electronic lock boxes on HUD Homes.
- Each field service manager will select the electronic lock box system that they will be using.
- Some of these changes are expected to roll out as early as this month. Roll-out dates will vary by state.
The above notes were based on a webinar produced by HUD. There were many more question submitted than the time available to answer them. We expect that there will be further information made available in the next week or two. In the past, there have been variations in procedures by state. Asset managers will be given responsibilities for marketing/sales in their assigned states.
Since I am just reporting some of the information that was presented in a webinar, questions would be best directed to HUD. They have given two ways to contact the FHA Resource Center: Call 1-800-225-5342 (I-800-CALLFHA) Monday thru Friday 8:00 am - 8:00 pm Eastern Time, or by email to info@fhaoutreach.com. In addition they have a Frequently Asked Questions section at http://www.fhaoutreach.gov/FHAFAQ/
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