Why HUD foreclosures?
My name is Tim Maitski with Atlanta Communities Real Estate Brokerage.
I am a HUD registered agent, which you need in order to place an online bid on a HUD property. All HUD agents also have special HUD keys that allow them access to show buyers any HUD home on the market.
Step #1 is to search for properties at
New listings get posted first thing on Wednesday morning. You can search for new ones by selecting "new listings" from the Property Status list. This will pull up all the listings that have just been entered into the system that have a 12 day time period to submit your bid. It also will pull up all the new properties from the previous Wednesday which will have until the next Sunday for bids to be submitted.
You'll get a list of homes with a picture of each. Some of them will have a so called "virtual tour" which is just a slide show of pictures. Click through to the detailed page for a property and you'll see some important details.
The most important link to find is the link for the Property Conditions Report. If you don't know what you are looking for you'll never find the link. It's the little link "here" that you need to click. It will take you to a page where you'll need to click "view property condition report"
Going back the the property detail page, you'll see the repair escrow with an itemized list of repairs that are necessary and the estimated costs of each repair. This doesn't mean that they are giving you any kind of allowance for these. If you are getting an FHA loan you will need to place that amount of money in escrow and take care of those items right after closing. FHA will also allow you roll those repair costs into your FHA mortgage.
Any property that needs more than $5000 in repairs will say that it is "uninsured". All that it means is that you can't get a regular FHA loan because of that. You can still get conventional financing and you can still get a FHA 203K renovation loan. Some people mistakenly think that "uninsured" means something about getting property hazard insurance on it and get scared off by that "uninsured" term. Again, it just means that it has at least one dollar more than $5000 in needed repairs. It means nothing more.
Once you find some properties that you are interested in, give me a call and I can meet you there to show it to you in person. There's nothing better than checking it out in person.
We can also check out other homes that are on the market in the area to get a better feel for whether or not it is a good deal.
We can also run a report to see what homes have been selling for in the area.
If you are ready to place a bid, we can do that pretty quickly online. We just need a few items such as your social security number and the bare basics of the offer. If your offer gets accepted, you'll have 48 hours to deliver the complete, signed contract along with earnest money to the HUD office in Midtown. If you don't deliver the contract in time, the property goes back in the system for a new round of bidding.
The morning after the bid deadline, you can find out whether you won the bid or not and see all the bids that were submitted. Click the "Buyer & Broker Info" tab at the top and then click "Search Offer Results". Just type in the property number in the box and you pull up the results.
Notice the bid on 6/24/2010 above. The net to HUD was 81.2% of list price. That apparently wasn't "acceptable". They then reduced the price to $99,000 which netted them 93% of list price.
HUD will go over all the bids right after the bid deadline and see if there are any "acceptable" bids. If none of the bids are "acceptable", they'll get the property back online and it will go into daily bidding. That just means that they will check for "acceptable" bids at the end of each day.
The question then is "What is an acceptable bid?".
They don't tell you that. But after you review hundreds of property bid results and if you know the HUD policies in other departments, you can get a pretty good idea where you need to be in order for your bid to be "acceptable". It's all about being within their required percentages of list price and how long a property has been on the market. If bids don't come in that are acceptable, eventually they will lower the price and then a bid that wasn't within the required range before will all of a sudden be "acceptable".
If you have any questions, please call me.