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Babysitting a HUD home: Things you and your agent can do to protect *you* while waiting to close on your HUD home.

Real Estate Agent with Keller Williams Realty - Lakeside Market Center

A few days I wrote an article about the National Association of Realtors® taking a stance and adding to
their Standards of Practice the verbage "don't give out the lockbox code!".   While reading and commenting
it reminded me of something that is taking place with HUD owned homes:   The locks are re-keyed with
the same HUD key being able to open any HUD home in my area. 

This past December I had another buyer client purchase a HUD home.   Thankfully, she was a cash buyer
so closing happened relatively quickly (Start to finish 30 days).  One of my (and her) biggest concerns during
the process was the security of the home post offer to the time it was legally hers.

Here are a couple of things that you can do to protect yourselves prior to closing on your HUD owned
  and changing the locks:

Take extensive photos prior to making an offer on the home and make sure the photos are dated. (Extensive means take photos of each room, close ups of the appliances, water heater, furnace,  plumbing system, etc.)

Take more photos during your home inspection and once again, make sure they are dated. 

Ask a neighbor or two to keep an eye on it.  We did this with Ashleys home.  I gave a neighbor my card and asked him to call me if he spotted anything amiss.  He was cheerful about helping as it is his neighborhood also!

Babysit the homeAsk your agent to stop by the home frequently to check and make sure everything is as it should be.  I stopped by the home every 2-3 days to peek inside.  We're out and about anyway, to  pop in only took a few minutes out of my day. 

Have a final walk through.   I cannot stress the importance of this.  If you can manage it, have it just prior to closing.  With Ashleys home we met at the house at 7:15 in the morning to look it over once again just before we drove to the 9:00 closing.   Anything can happen the night before closing and you wouldn't know if it you had your walk through a day or two before.

If you do all of the above you will be much more successful in getting HUD (and it's designated agent in your area) to repair or replace anything should anything come up missing or vandalized prior to your closing on the home.

Comments (43)

Jodi Tussing
Century 21 LLC - Southington, CT

Great Blog! So true! I know agents in my area that routinely give buyers the loc box combinations to REO properties, they don't even go with them to the house! Yes they are REALTORs, and they are in the top 10 in Connecticut.

Thank you for taking the time to post this, I would not have even thought about the pictures et for the proof at closing that the property was in the same condition as when they wrote the offer.

Feb 16, 2010 02:45 PM
Vickie Nagy
Coldwell Banker Residential Real Estate - Palm Springs, CA
Vickie Jean the Palm Springs Condo Queen

Hello Kris, these are all very good points to ponder. Thanks for sharing. We don't see many HUD homes in our area, so it's great to hear about best practices.

Feb 16, 2010 02:46 PM
Christine Donovan
Donovan Blatt Realty - Costa Mesa, CA
Broker/Attorney 714-319-9751 DRE01267479 - Costa M

Good advice to help your buyers protect their HUD home prior to the closing.

Feb 16, 2010 03:14 PM
Roland Woodworth
Blue Cord Realty - Clarksville, TN
Blue Cord Realty

What a great idea Kris... Photos with dates canbe very helpful as for the condition of the home.

Feb 16, 2010 03:53 PM
Bob & Carolin Benjamin
Benjamin Realty LLC - Gold Canyon, AZ
East Phoenix Arizona Homes

Taking photos and noting serial numbers (if there are any to note) is a good idea.

Feb 16, 2010 04:11 PM
Esko Kiuru
Bethesda, MD


Must-do advise nowadays. Especially here in Vegas with so many foreclosures and vacant properties on the market. Taking pictures will save many a day.

Feb 16, 2010 04:24 PM
Randy Ostrander
Lake and Lodge Realty LLC - Big Rapids, MI
Real Estate Broker, Serving Big Rapids and West Central MI

Great advice on Hud homes. Sad but true these days an ounce of prevention is definately worth a pound of cure.

Feb 16, 2010 05:40 PM
Barbara Kornegay
REMAX Essential - Wilmington, NC
Wilmington NC Real Estate, Homes

Great advice for HUD homes but also good advice on any home...  In this day and age the homeinspectors are not very busy and usually can get to the home in a matter of days after the contract is signed...  If thie home does not close for six weeks - it is amazing what can happen!

Feb 16, 2010 08:26 PM
Kris Wales
Keller Williams Realty - Lakeside Market Center - Macomb, MI
Real Estate Blog & Homes for Sale search site, Macomb County MI

Hi everyone, thank you for taking the time to read and comment.   Normally I would respond to each of you, but I would sound repetitive on this post with the "thanks!  Glad you found it helfpul!".  This was clearly one of those "hope it informs" articles for you and your buyers.   I'm happy it was featured so that more of you could see it and reblog it for your outside blogs.  

A couple of things that I got from reading your comments:

I always take close up photos of the appliances, but have never tried to snap a photo of serial numbers. What a great idea!

Michele (above) mentioned an issue she had with a HUD home that was found at the walk through.  It's why I stress that a walk through take place.  If your buyers can't be there then by all means you do it for them.  An ounce of prevention..and all that jazz.   Pam (above) also mentioned a home that was a "total rehab" but still had more damage between offer and closing.  Document, pick up the phone, and keep checking on them!

An aside to Missy, I see so many of them have accepted bids for well more than asking price.  On the flip side, many are also priced right at market value, so the "overbids" I just don't understand.  Seems like some people are overpaying, but then again, the value is in the eye of the beholder.



Feb 16, 2010 08:40 PM
Renée Donohue~Home Photography
Savvy Home Pix - Allegan, MI
Western Michigan Real Estate Photographer

This goes for Fannie homes too on the master key!  I have had stuff stolen or homes vandalized in the last hour and it is SO frustrating!

Feb 16, 2010 11:20 PM
Allison Stewart
St.Cloud Homes - Saint Cloud, FL
St. Cloud Fl Realtor, Osceola County Real Estate 407-616-9904

This is great advise for REO properties as well.  An accepted offer is not the same as a closed sale. A picture speaks a thousand words.

Feb 16, 2010 11:23 PM
Allison Stewart
St.Cloud Homes - Saint Cloud, FL
St. Cloud Fl Realtor, Osceola County Real Estate 407-616-9904

This is great advise for REO properties as well.  An accepted offer is not the same as a closed sale. UA picture speaks a thousand words.

Feb 16, 2010 11:23 PM
Terri Adams-Scott
J. Rockcliff, REALTORS - Walnut Creek, CA
Realtor, Walnut Creek CA Real Estate

This is great advice.  Thanks for sharing!

Feb 17, 2010 01:11 AM
Joe Pryor
The Virtual Real Estate Team - Oklahoma City, OK
REALTOR® - Oklahoma Investment Properties

I started my real estate career selling HUDs in 1989. It looks like I may have to bobe up on my education again. Thanks for the tips. My memory of HUDs in Oklahoma is that you get a universal key that anyone can copy, so security for HUDs is non-existent. I know too many agents that give their keys or copies to buyers especially investors.

Feb 17, 2010 01:11 AM
Joel Weihe
Realty World Alliance - Wichita, KS
Helping you to use your VA home loan benefits

Good advice for any home, but especially important on these!  I often do a video walk through at time of offer to document condition when I suspect we may have issues, but usually to make sure the seller left things, didn't ding things on move-out, etc.  Note to self to do this absolutely for ALL homes!

Feb 17, 2010 01:35 AM
Mike Woods

Invaluable advice. Taking dated photos was a great idea that may seem like unnecessary work, until you need them.

Feb 17, 2010 02:25 AM
Carla Muss-Jacobs, RETIRED
RETIRED / State License is Inactive - Portland, OR

I knew a HUD listing agent that videotaped the property and made comments as she was going through each room, as a 'voice over'

Feb 17, 2010 05:23 AM
Thesa Chambers
West + Main - Bend, OR
Principal Broker - Licensed in Oregon

as a HUD listing agent I am amazed at how many buyers think I am crazy when I show up after they move in - and ask if they changed the locks (when they are not my buyers) they generally respond no - and when I explain that they should have been informed of the key situation and I would like to pick up the key they are dumbfounded and thankful

Feb 17, 2010 04:16 PM
Chris Minion
O'Brien Realty - Lexington Park, MD

Hello Kris,

Terrific tips for HUD homes & protecting buyers.  So many people have access to HUD homes.  Thanks for the good advice.



Feb 18, 2010 01:20 AM
Shannon Thomas
Selling Indy Metro, LLC - Avon, IN
Managing Broker, E-Pro, ABR,SRS, SFR

Great tips!  We are doing the  home inspection on one today and will make sure and take the camera with. 

Jun 14, 2011 11:46 PM