Buying a HUD property

[AIR]

If you buy a HUD property as owner occupant. Is it going to be a problem if in a few months after moving in you decide to rent it out or even sell? I have been scanning for information but I am unable to come up with a definite answer. Also if you use a FHA loan will this effect the whether you rent or sell in a few months after buying the property?

[ZNICK]

I'm not sure if you're inquiring about seasoning or not, but I was told last week by a mortgage broker who specializes in FHA loans, that you can do a double closing on property that had just went through an FHA foreclosure and most lenders will not be concerned with seasoning.

In other words, you can buy the property and re-sell to your retail buyer in one fell swoopala!

Z

[jc1409]

I know HUD has special programs and incentives for owner occupants (and exclusive bidding opportunities for OO up front), and they treat these homes differently in the way they think of them generally within HUD as compared to investor purchased homes. If I bought a HUD home thinking I may live in as owner occupant for a few months, with strong possibility of renting or selling after that, I think I would be inclined to identify myself as an investor in my bid. I don't know what your situation is, so this may not apply.

You might call the regional broker for HUD in your area and pose this question to them. If you are identifying yourself as owner occupant (because you will be), and not using any of the HUD owner-occupant incentives, it may be that you get an answer of 'yes, identify as owner occupant'. I'm guessing you'll find there are restrictions (and requirements to stay in the house) if you are an owner-occupant and using some of the HUD incentives for owner occupants.

Are you bidding in the inital OO period or planning to use any of their OO programs?
Jeff

[haynesm]

I have a question or two about HUD and owner occupant homes. I am interested in making bids on two properties but I do not intend to live in either of them. Therefore I just “assumed” that I could not make a bid until the OO period was past. But from reading in this post I am thinking maybe I could make my offer during the OO period. These would be cash deals, no loans on my part, and I would owner carry when I sold at a later date IF needed. I would use no special programs and incentives for owner occupants as mentioned by jc1409.

From TIM’S post: Of course if you sold after a few months and the buyer got a new loan, there would be no problem.


Now ZNICKS post comes up and gives me the impression that since there would be no loans from me then maybe I could get in on the OO bid period. However, one bid closes tomorrow and one at the end of this week. I could wait but I am ready to go.


From ZNICK”s post: I'm not sure if you're inquiring about seasoning or not, but I was told last week by a mortgage broker who specializes in FHA loans, that you can do a double closing on property that had just went through an FHA foreclosure and most lenders will not be concerned with seasoning.

In other words, you can buy the property and re-sell to your retail buyer in one fell swoopala!

Any input from anyone. Remember, I like my freedom and jail is not an option.

[haynesm]

Tim
What you say might be so but when I go to place a bid it won't let me. It says I must be a registered RE agent. And the agent I talked to says I have to wait until it is open to investors. What's that about a catch 22. Here is the site http://www.bidselect.com/ Any more suggetions beside WAIT !!!!! Don't you just hate it when someone else has controll of you.

[ZNICK]

I've not bought any HUD homes, but I am under the impression that you must have a Realtor bid on your behalf, AND you're correct about the waiting period if you're an investor. They let owner occupants bid for a certain amount of time, then if none have bought, investors can bid.

Again, I am under his impression, but it may be different state-to-state, and then again, I may just be wrong. :P

Z

[Ulric]

Hello....
What is the benefit of buying a HUD property if it is at market value anyway?can any one give me a clear advice.....Thanks

[haynesm]

Ulric
If you are going to the HUD site looking at properties they usually give their impression of market value and also their asking price. BUT you place a bid way lower (depending if you are just investing or if you are really wanting the property)

Example: I saw a MH and 6 acres listed with HUD market value of 39K, HUD was trying to sell for 32K and finally took an offer for 16K. The other day I saw a property that was listed (again). It had been listed as market value of 114K but they had come down to 79K. Then it sold for 55K and now is back on HUD's market for 79K. I guess the people couldn’t get their financing.

PS: by the way, I was able to buy the property I was talking about on this post earlier. Someone's offer had been accepted but later property came back on market.

[Dan Auito]

I've bought two huds, one owner occupied and one not. Was in the military on the owner occupied one, got orders in three months and rented it out for 7 years.
Bid through an agent on the non occupied owner one, I think my offer was higher than the owners who were bidding so I believe they let me bid with them.

I'm getting alzheimer's so I'm forgetting many of the details. LOL

[Dan Auito]

Other than some financing breaks for repairs using the 203k loan there really isn't any. Nobody is paying market value today unless of course it is discounted market value.

[Trailer man]

HUD has some funny rules and no one seems to be privy to how exactly it all works. As I understand it investors bids during the owner occupant periods will not even be reviewed even if some uninformed realtor does send one in. When it gets to the daily bid status I have seen them accept a lower OO bid over a investors bid. I have bought 4 properties off the HUD site as an investor and have flipped them making a small profit on each one. Nothing to brag about for sure. HUD is probably not the easiest way to buy low since the competition is fierce. I am still trying to figure out how to find the real deals out there. It seems to me that most good deals are vacuumed up by the attorneys and real estate brokers before they ever hit the street.