How to Buy HUD Foreclosures
When a homeowner fails to maintain payments on an FHA insured mortgage, The United States Department of Housing and Urban Development (HUD) pursues foreclosure to become the legal owner of the property. HUD foreclosures can happen on one- to four-unit residential houses. Anyone with the ability to do so may purchase HUD foreclosures. In many instances, these properties are affordable and readily available in most areas.
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Instructions
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Locate HUD properties for sale by visiting your state's HUD Homes website. These are third party websites listing properties currently for sale by HUD, but the websites are under contract directly with HUD.
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Speak with a HUD housing counselor if you are unsure about how to buy a home through HUD or need help obtaining a loan to purchase the property. Official HUD housing counseling agencies provide advice to individuals on buying real estate without cost or for a reduced cost. Contact these professionals through HUD's website.
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Obtain necessary financing to purchase HUD foreclosures. Local and national mortgage lenders, banks and credit unions can finance HUD foreclosures. Individuals must meet income, employment and credit score requirements. Purchase these properties using FHA loans or VA loans if you qualify for them.
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Consider special programs you may qualify for, including discounted costs for those who are law enforcement officers, firefighters, emergency medical professionals, teachers and local government employees. Your lender may help you to qualify for these Good Neighbor Next Door programs directly or you can learn more about them at HUD's website.
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Locate a real estate agent registered with HUD. Ask local real estate agents if they are qualified to work on your behalf to purchase HUD foreclosure homes. If they are, these professionals are able to submit offers and contracts to purchase the property on your behalf.
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Negotiate and have a home inspection before signing any documentation to purchase the home.
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Tips & Warnings
It may be possible to negotiate the sale price of foreclosure homes through your real estate agent.
Keep in mind that although HUD is selling the homes, they make no guarantee of the safety of the home. Therefore, a home inspection is often an important step. All HUD foreclosure homes are sold As-Is and without any type of warranty.
