By Living Room Realty, June 25, 2019
I was working with a buyer looking for a home that could be fixed up and create great equity. We found terrific home in the Cully neighborhood. It was a good value, good bones, and a great location. What I didn’t realize, is that a HUD home (one owned by the government-Housing and Urban, Development-and yes, all paperwork had the Secretary of HUD, Ben Carson, as the seller) is a totally different animal than a bank owned, Fannie or Freddie Mac owned home sale.
First, the HUD home is listed by a local REALTOR®. The listing agent is not who you actually deal with though. There is a third party vendor, hired by HUD, who is the go between HUD, the listing agent, and the buyer’s agent. It wasn’t until the end of the transaction that I actually identified the main person to communicate with as the third party vendor. It quickly became obvious that it was going to be a difficult transaction when it took 5 business days from the time the offer was submitted to when it was officially accepted. HUD will only use their own paperwork and will not sign any other paperwork. HUD will not negotiate anything. The home is sold as-is even if it doesn’t have a furnace (like ours-it was stolen). After a process that really didn’t need to be as hard as it was, we finally made it to closing. Lastly, they kept sending me threatening emails about how bad it will be for my client if we did not close on time. It was HUD that couldn’t sign all the appropriate documents on closing day and almost forced a delay. Luckily, we had a great underwriter who got us closed on time, despite HUD.
Conclusion: Make sure it’s really worth it before getting involved in a HUD home sale!
