HUD question
Will HUD counter an offer or just disapprove it. I have read on here that HUD will not accept below 82-85% of their asking price. If the asking price is 100k should I start at maybe 77-78k so we can negotitate? or would I need to put in a 82k bid and see what happens?
Is HUD more willing to come down the 15-18% after on the market a while, or is that a general rule of thumb right off the bat? WIll they ever go lower say if the property has been on the market for 100+ days?
Thanks
Tim
This is a good question. When I'm checking into HUD homes for my area I sometimes see listings that have past the date for bidding. My impression is that HUD would entertain a lower bid price on these homes. But, I am just getting started with putting all this real estate investing knowledge to work. It would be interesting to to hear what an experienced investor in this area has to say. Good Luck.
Quote:Will HUD counter an offer or just disapprove it. HUD does not counter an offer, nor does HUD disapprove it. They either accept it or do nothing. If your offer is not accepted, you go back to the drawing board and determine if you want to increase your offer.
Quote:I have read on here that HUD will not accept below 82-85% of their asking price. If the asking price is 100k should I start at maybe 77-78k so we can negotitate? or would I need to put in a 82k bid and see what happens? For investors, the NET to HUD needs to be at least 87% of list price. This means that after your real estate broker takes his commission off the top and HUD pays any closing cost assistance you requested, what is left over for HUD needs to be at least 87% of the list price. In actual practice, you do not have a lot of room below the list price to work with. In your example, if the asking price is $100K, you will be using your own financing, HUD is paying a 6% sales commission, and you are not asking for any closing cost assistance, your minimum offer should be between $93K and $94K.
Quote:Is HUD more willing to come down the 15-18% after on the market a while, or is that a general rule of thumb right off the bat? WIll they ever go lower say if the property has been on the market for 100+ days?After some period of time on the market, if the property is unsold, HUD will (1) lower the asking price between 5% and 10%, or, (2) continue to list without a price change, or, (3) take the property off the market for awhile, then relist it later for full price.
HUD bids must be submitted by a HUD approved broker. The broker you use should be able to walk you through the bid process, step by step.
Thank you David T. for answering some of the info. I needed for HUD purchase. Can you only purchase through broker (I am in DE) Rural distressed farm property, do you usually have to live in the property for a length of time? Would you go to HUD for list of properties, or just go through a broker? I am new to this area. Any info. would be appreciated!! Thank a million!!
Now what about the grant part? can you get a grant for the down payment?
How about a grant to fix up the property?
I do know about the 203k loan to fix it at 2-3% intrest.
and do you know if your company can be qualified to be on the list of contractors for the 203k loan ? and how?
I have done a 203K loan through Wells Fargo. Not many lenders do 203k loans any more. I would recomend a conventional rehab based on my experience with the 203K process (total nightmare, almost foreclosed due to the lender even though payments made...long story). As far as the 2-3% rate..... never heard of that. The 203K is usually slightly higher than going rates because of the special program
For the grant program....there is a HUD program with restrictions. Basically it help you make your downpayment by making an offer on the property that includes the closing costs and downpayment on the buyers end. The funds go to the "Neahmiah Foundation" (Sp) which gifts it back to the buyer.
My .02
Troy
Quote:Can you only purchase through broker (I am in DE) Rural distressed farm property, do you usually have to live in the property for a length of time? Would you go to HUD for list of properties, or just go through a broker?Bonjohn,
Yes, all offers on HUD foreclosure property must be submitted by a HUD approved broker and submitted on HUD specific forms. The HUD approved broker you use will have all the forms.
If you are bidding on the property as a owner-occupant, then you must occupy the property as your primary residence for at least one year. One of the forms you will sign and attach to your purchase offer will certify your intent to occupy as your primary residence.
If you are bidding on the property as an investor, then there is no occupancy requirement.
You can either go through your broker for the HUD available properties, or glean them from the HUD Website yourself.