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Bidding On A HUD Foreclosure Home
In June of 2008, foreclosure filings were up an average of 50% in most American states. You can take this news in many ways. But for the real estate investor, this is great news. There are now more choices than ever to not only make a profit, but to help become your own boss and be in charge of your financial future. However, don’t be tempted by the vast array of HUD foreclosure homes that are on the market. You still need to look at each HUD foreclosure home with a cool head before deciding on making a bid.
Do Your Research
Remember, HUD foreclosure homes are sold as-is, even if there are corpses and craters inside of it. Never contemplate bidding on a HUD foreclosure home sight unseen. You must inspect it yourself. You also need to keep in mind that if people are going to be living in the property right up until the sheriff kicks them off, they will leave damage in their anger that you will be responsible to fix.
Although HUD foreclosure homes often come with commission fees paid by Housing and Urban Development, they don’t often pay the back taxes or any other fees that the previous owner couldn’t pay for. You need to get the HUD broker to check up on the physical and financial condition of the house.
Finding The Property
A HUD foreclosure listing is a matter of public knowledge, much in the same way marriages and divorces are. You need to check out your state's HUD's web site in order to keep tabs on which foreclosed houses they are planning on buying. Don’t expect them ever to get a property in a hard-to-get-into neighborhood, or a home that's worth more than $400,000.
You then need to contact the broker or company that is working with HUD to sell the property. This is the person or business that you will be getting to know very well in your pursuit of the HUD foreclosure home. If a HUD employee offers to work with you as a real estate broker to help you buy the home, bolt. This is illegal.
What Am I Bid?
For the first ten days that the HUD foreclosure home is on the market, only people wishing to live in the home are allowed to bid. If you are a real estate investor, you will have to wait. Odds are that your HUD foreclosure home will still be there waiting for you. You then bid electronically with your HUD-approved broker. You'll know in a few days if the bid was accepted by HUD.