So what is a HUD Home?
A home that has gone into mortgage default with a loan that is insured by the Federal Housing Administration (FHA) is referred to as a HUD Home. When this occurs, the lender takes possession of the property and conveys ownership to HUD. HUD then sells the home through their Asset Management (AM) contractor, such as BLB Resources. A HUD Home may be a single-family house, townhouse, condominium, mobile home or a multiple family attached home up to 4 units.
HUD Homes may be purchased by any individual, company, HUD-approved non-profit organization, or government entity that can secure financing or pay cash for the property. Interested buyers must submit bids through a HUD-registered real estate agent. A pre-qualification letter from a lender is required for buyers obtaining financing. Cash buyers are required to provide proof of funds for at least the amount of the purchase price. HUD will award the winning bid to the purchaser with the highest acceptable net to HUD. Winning bids are subject to completion and receipt of all required documentation by BLB Resources.
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Your Bid has been accepted, Now what?
If you collected all of the required documents and information upon submitting your bid online, this next step should be stress free.
If bid is accepted:
- Buyer must select any State Licensed Escrow Company upon bid acceptance
- Buyer Select Addendum is completed and submitted to BLB Resources with contract package within 2 days of bid acceptance
- Addendum includes EMD instructions and statement that buyer agrees to EMD being held by LLB then forwarded to selected escrow company within 48 hours of contract ratification
- Updated contract packages will be available on both HUDHomestore and BLB Resources’ forms download page www.blbresources.com
- Buyer Select addendum will also be available as a separate downloadable form on the forms page
- Note that original contract package must include a COPY of EMD
Original EMD is submitted to LLB within 2 days of bid acceptance
Depending on the buyer’s financing, below of the documents that need to be submitted along with the contract:
- Owner occupant disclosure
- Home inspection disclosure
- Mold and radon gas disclosure
- C.A.R. Agency disclosure
- Prequalification or verification of funds if purchasing with cash
- The contract addendum disclosure
- Forfeiture and extension policy
- Lead based paint disclosure if the property is older than 1978
- Home inspection suggestion
- Carbon monoxide detector addendum
- Request for pest inspection if buyer is using FHA financing
- Appraisal request form if buyer is using FHA financing
- Earnest money deposit
All of these forms can be found using the “forms” tab on BLB Resource’s website at www.blbresources.com.
BLB Resources require wet signatures (preferably blue ink) on all of the contract documents. This is yet another reason why you should gather everything upon submitting your bid online. This will prevent any delays in submitting your contract. If your documents are signed before bid acceptance, you won’t have to stress in getting your clients and broker to sign the documents. Once you have been notified of your bid acceptance, you will have 48 hours to get the contract over to BLB Resources in Irvine, CA. This means that in reality, you will only have 24 hours to gather the required documents because you will have to overnight the documents in order to get them in within the 48 hour deadline.
You may also go to HUD’s website at www.HUDHomestore.com. This website has many resources available to you. The local listing broker is also very knowledgeable. There is plenty of help to assist you with any of your questions. Don’t hesitate to use the resources available to you. You might be surprised as to how easily you can find an answer when you look into these resources.