FHA pays lenders that file foreclosure claims when borrowers default on their FHA insured mortgages. FHA will transfer the ownership on the foreclosed houses back to HUD. Anyone can purchase a HUD government foreclosed home in Hollywood, FL if they plan on residing in it as their primary residence. HUD homes are sold at substantially discounted prices way below market value. In fact, you may be able to buy a HUD foreclosed home with as little as a $100.00 down payment.
Locating HUD Foreclosed Homes
To start your HUD foreclosure search, you can look on the HUD foreclosure website to see which foreclosed houses are available in the Hollywood, FL area that meet your criteria. You can also check with a local Hollywood Realtor. The Realtor will also be able to write the offer and present it on your behalf. You may also want to check the local newspaper and the Internet for more foreclosure listings.
Investing in a HUD Foreclosed Home?
Investing in HUD government foreclosure properties is a good way to find a home in an area that you may not otherwise be able to afford, or if you are looking for an inexpensive rental property that you can fix up and rent. The good thing about purchasing HUD foreclosed houses is that they are sold way below market value so when the real estate market bounces back you know you have a property with built in equity that you can sell if you want to or hold on to as a long term investment. Also, HUD properties don’t require large down payments. You may have to fix the home up, but since you are purchasing it for such a great price, you should be able to budget for repairs.
What you Should Know?
Even if HUD has a home inspection report on the property, you should do your own inspections as to the condition of the home. All HUD homes are sold in an “as is” condition, and HUD normally does not make any repairs. This way, if you have a professional home inspection, you know what you are getting. If the home needs major system repairs, you can decide if you want to continue with the purchase or not. You should also be aware of the following guidelines when purchasing HUD foreclosures:
- HUD does not provide financing. You must obtain your own.
- You can obtain an FHA mortgage on your own, but you must purchase FHA mortgage insurance
- You must purchase the home as your primary residence. If there are no owner occupants bidding on the property, then investors may bid on the property.
- HUD only accepts full price offers.
- HUD will pay up to 3% of the price towards the buyer’s closing costs if you request it in your offer.
- A licensed real estate agent must represent and submit your offer on your behalf.
- HUD will notify your real estate agent within a day or two after you submit your bid if they have accepted it. Closings generally occur within 30-60 days after acceptance.
- HUD will pay the real estate broker’s commission if they request it in writing in the offer.
Buying a HUD foreclosed home in the Hollywood, Florida area is a great investment. There are also good deals on pre-foreclosure and REO properties as well. Your Realtor can help you find foreclosed houses in the area that meet your price range and other criteria.