About HUD properties
MAGNOLIA PROPERTIES IS ONE OF NORTHEAST FLORIDA'S LOCAL LISTING BROKER'S FOR HUD. SERVING ALL COMPASS POINTS OF DUVAL, CLAY, AND ST. JOHNS COUNTIES. MAGNOLIA PROPERTIES HAS ONE OF THE LARGEST INVENTORIES OF PRE-OWNED HOMES. WHY IS HUD SELLING THE PROPERTY?
The primary housing and lending regulatory authority in the United States is known as "HUD," the U.S. Department of Housing and Urban Development. Among many other things, HUD is responsible for the operations of the Federal Housing Administration (FHA), which is the agency that insures mortgage lenders against loss on FHA home loans. When FHA borrowers default on their obligation, the lender initiates the foreclosure process. HUD becomes the owner of the properties after foreclosure is completed and after the lender has made a claim against the FHA insurance fund for payment of the remaining balance of the loan. HUD wants to sell the property as quickly as possible and recover as much of the claim amount as it can to replenish the FHA insurance fund. Since 1999, HUD has hired Management and Marketing (M&M) Contractors to maintain and sell the HUD-owned single family residential properties (1 to 4 units). These M&M Contractors, following HUD guidelines, are responsible for all aspects of property care and resale on behalf of HUD. National Home Management Solutions, LLC (NHMS) is the M&M Contractor for the States of Florida, New York, New Jersey, and Ohio. NHMS is responsible to make decisions regarding the properties that serve HUD’s best interests. The objectives include creating the best possible opportunity for real estate brokers and agents to represent purchasers so as to increase homeownership and enhance communities.
Your HUD Home can be Your Dream Home
If you are thinking about buying a REO property that needs repair, FHA’s 203(K) rehabilitation loan or it’s simplified alternative, the Streamlined(k) may be a good option for you. FHA’s simplified Streamlined(k) program for small-scale repairs is the perfect option for most HUD REO sales. For the major repairs & more complicated renovation plans, the Standard 203(K) program is the option.
HUD Homes, like the majority of property re-sales, require some level of repair. FHA’s Streamlined (k) program allows the buyer to finance both the purchase and the cost of minor repairs and/or upgrades through a single mortgage. While there is no cap on repairs for the Standard 203(K), the Streamlined (k) allows for repairs from $1 up to $35,000.
For the Streamlined(k) option, homebuyers identify their repair needs, which may include: new carpet; interior and exterior paint; new appliances; kitchen or bathroom remodel; exterior landscaping and other minor improvements.
Who Can Buy a HUD Home?
Almost anyone! If you have the cash or can qualify for a loan (subject to certain restrictions) you may buy a HUD Home. HUD Homes are initially offered to owner-occupant purchasers (people who are buying the home as their primary residence). Following the priority period for owner occupants, unsold properties are available to all buyers, including Investors.
How Are HUD Homes Sold?
All properties available for purchase by the public are offered for sale at Internet listing sites maintained by management companies under contract to HUD. Any real estate broker registered with HUD may submit an offer and contract to purchase on your behalf. HUD pays the real estate broker's commission, if included in the contract.
HUD Homes are offered for sale at fair market value, based on a recent appraisal. Generally, HUD Homes are sold in what is known as an "Offer Period," during which a potential buyer's offer must be made. At the end of the Offer Period, all offers are opened and the bid providing the highest acceptable net return to HUD may then be accepted. Following the initial "Offer Period" homes remaining unsold are offered on an "extended" basis which means offers may be submitted any business day. If a bid on one of these homes is acceptable, the broker will usually be notified within 48 hours of HUD's acceptance of the offer.
