How to Find HUD Foreclosures
Housing and Urban Development (HUD) homes are being foreclosed upon as quickly as conventionally finance homes. The HUD homes can be picked up at unbelievably low prices. You just need to know where to look to find these real estate investment gems.
- Difficulty:
- Easy
Instructions
Things You'll Need
- Authorized HUD Real Estate Broker/Agent
- Internet Access
- General Real Estate Knowledge
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How to Find HUD Foreclosures
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1
Contact the Housing and Urban Development offices. This office has a list of the distressed properties available for sale. These properties include single family homes, mulit-family homes, commercial property, vacant land, and more. The HUD office has a website which allows you to view all the properties available across the country.
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2
Contact your local real estate broker or agent for a list of foreclosures. The real estate offered by HUD is handled through a real estate broker. Almost every broker has a list of these distressed properties. You can call to have a list mailed to you. You can also walk into most real estate agencies to obtain a list of the foreclosures.
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3
Review the list of HUD homes available. There will be a general description of the property. This listing will include any inspections that were done. This information sheet will also include the asking price.
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4
Determine the fair market value of the property you are interested in purchasing. The selling price is generally much lower than the market value of the property. You will also need to know how you plan to use the property. You must take into consideration any repairs that may need to be done. You can tour the property and have a general inspection done before bidding on the property.
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5
Bid on the HUD property you are interested in purchasing through the authorized real estate broker/agent. The secret is not to bid the asking price. There are many homes listed which can be bought for just a few thousand dollars. Other properties may be in high demand so there may be other bids on them. The key to successfully bidding on a HUD home is to submit a second bid if the first one is rejected.
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1
Tips & Warnings
Research the neighborhood to determine why the property was foreclosed on. It may have been a personal financial problem. However, it could also have been caused by a poor economy. If this is the case, the property may not be the good investment you thought it was.
If your first bid is rejected for being too low, the second bid should only be $500 higher. Many times if there are no other bids, the second offer is accepted.
Any bid must be accompanied with an earnest money check. This is generally a cashier's check for $500 or more. The real estate agent will be able to tell you the amount of the check.
Do not buy a property just because it looks like a good deal. If the market area will not support the investment, you will lose money.
Do not buy a property that you have not thoroughly inspected. There could be unseen damage that only a professional can determine.
