HUD Foreclosure
by Tom Powell
ArticleInsider.com
HUD foreclosure is different than a normal foreclosure. When the homeowner stops making payments, the HUD office is notified. HUD is a type of insurance that covers foreclosures. That means that the bank will not foreclose on the person but the HUD office will.
Info on HUD Foreclosure
An HUD foreclosure is similar to a VA foreclosure. It is a loan that is guaranteed so that if the person falls into default, the HUD office pays the bank and assumes title of the property. The property is legally transferred from the borrower to the HUD through payment to the bank.
HUD handles their foreclosure sales different than banks do. The banks will auction off the properties and sell to the highest bidder regardless of the bid. The HUD office makes you go through a real estate agent and by at market value. This means that you will not be getting a great deal if there are no other interested parties.
The best way to get a great price on an HUD foreclosure is to buy one that needs to be fixed up. These properties are sold as is and have no insurance for items that need repair. When they are appraised, the problems are taken into account. This will warrant a discount to anyone who is willing to fix up the house themselves.
