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Helping El Pasoans BUY $ SELL
"America's Leading Discount
Real Estate Company'
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Providing a superior level of informed, professional real estate services to buyers and sellers in the greater El Paso area. America's Leading Discount Real Estate Company | |
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GOVERNMENT FORECLOSURES
View Our RESALE LISTINGS click on side link Buyers & Sellers Realty
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| FACTS ABOUT ASSIST-2-SELL
We will sell your home for as low as $2495!*
We advertise your home.
We show your home to buyers.
We arrange for other agents to show your home.
We arrange all inspections.
We pre-qualify Buyers.
WE DO EVERYTHING!
America's Leading Discount Real Estate Company
View Our RESALE LISTINGS by selecting Buyers&Sellers Realty on the side Menu
The following information will assist you in understanding how to purchase a government-owned home.
Anyone can buy a government-home
HUD homes can be purchased by anyone. While many of the HUD-owned homes in our inventory are affordable for low to moderate income individuals and families, there is no income restriction on purchasing these homes. However, a buyer must submit a pre-qualification letter from a lending institution or have proof that they can pay cash for the home in order for a bid to be eligible. Homes may be purchased by owner-occupants (those buyers who plan to live in the home for a minimum of one year) who have a priority bid period of 10 days. Investors may also purchase HUD-owned homes, but their bids are only accepted if an owner occupant bid does not meet the reserved price in the first 10 days a property is on the market. Reserved prices are not published for any HUD-owned property.
HUD homes are sold at market value
HUD homes are initially listed at the "as is" appraised market value. The buyer may offer any price, but HUD will only agree to offers that provide an acceptable return. The amount of the acceptable return is not available. Price reductions may take place if the home does not sell so view property listings weekly to monitor inventory and listing prices.
HUD homes are sold "As Is"
It is important to understand that HUD homes are sold in "as is" condition. This means that the condition of the home when you see it is what you will be buying. HUD or Southwest Alliance makes no warranties, does not guarantee the condition of any home, and does not verify that it complies with any local code or zoning requirements. You must make any necessary repairs after the purchase. HUD may make, or give you an allowance for, major system or safety repairs only if you are purchasing with an FHA-insured loan. It is very important that you get a Home Inspection by a licensed professional prior to closing on the sale to fully understand the condition of the property.
Deadlines must be met
When purchasing a HUD home, you should submit your best offer during the bidding period. In order to be fair to all purchasers, HUD has imposed timetables that must be met or your bid or contract will be cancelled and the home returned to the market. Once your bid is acknowledged as the highest net to HUD, your agent must send in a correct contract within 48 hours or the bid will be cancelled. Generally, closing must take place within 60 days, "cash" deals typically close in 30 days.
Making an Offer on a HUD Home
Offers on HUD-owned homes must be made online through a HUD-registered broker.
If you want to make an offer on a HUD home, you must bid through a HUD-registered broker. For a list of local approved brokers, click on " How to Find a Real Estate Agent " on the left side of this page. To find the local Listing Broker, click on " Property Listings: HUD Owned." The listing broker provides general services to Southwest Alliance such as placing a For Sale sign on the property, listing the home on the MLS (Multiple Listing Service), providing a Broker Price Opinion (BPO), performing regular property inspections and assisting agents and buyers in the purchasing process. The listing broker can refer you to an agent in your area who can help you with the HUD bidding process or the Listing Broker can also work with you to submit an offer on a home.
How to find a HUD home
You should contact a HUD-registered broker as instructed above. These brokers will have a list of HUD homes in their area, or you can view HUD-owned homes by clicking on " Property Listings: HUD Owned."
Offers must be submitted through an online bidding process
All offers must be submitted by a HUD-registered broker through our online bidding process. Offers are made via computer through the Internet. The electronic bids are stored in the computer system and, at the appropriate time, calculations are automatically performed to determine the highest net offer to HUD.
The highest bid is acknowledged by Southwest Alliance to your broker, who is notified to send in a correct, signed sales contract within 48 hours. If the contract is not received within 48 hours or is incorrect, the home will be returned to the market or acknowledged to the next highest bidder. All acknowledged bids are subject to cancellation if prior sale, electronic error, and other conditions exist (see Disclaimers). An acknowledged bid does not constitute a sale; only a correct contract that is executed by Southwest Alliance and returned to your agent allows you to proceed to closing.
Initial Listing Period
The initial listing period, which is generally the first public listing for HUD homes, is 30 days. During this time, priority is given to owner-occupants who are buying the home as their primary residence. Please see the Guidebook for your state for more information on Listing Timelines for your area.
All owner occupant offers received during the first public listing are considered to be received simultaneously.
If there is no acceptable bid, bids are reviewed on a daily basis for the remainder of the listing period. Bids received at different times during the day will be considered received simultaneously, and the highest acceptable net bid will be acknowledged on the date opened. If the property remains unsold after the initial listing period, it is made available to investors as well, and bids are reviewed on a daily basis. (Investor bids may be placed at any time but are not reviewed until the end of the initial listing period, if the property remains unsold).
An owner-occupant purchaser is defined as a purchaser who intends to use the property as his or her principal residence for a minimum of one year; a state, governmental entity, tribe, or agency thereof; or a private nonprofit organization. Governmental entities include those with general governmental powers (e.g., a city or county), as well as those with limited or special powers (e.g., public housing agencies).
Subsequent Listing Period
When a property still remains unsold after the 30-day initial listing period, Southwest Alliance will re-analyze the case, and may, with HUD’s approval reduce the price. For five days after the price reduction, all bids are considered simultaneous, with owner-occupants given priority. After the five-day initial reduced price bidding period, then bids are reviewed daily and the acceptable bid that offers the highest net value to HUD (regardless of occupancy) is acknowledged.
Contract must be submitted within 48 hours
If your bid is acknowledged, your broker must submit a correct HUD Sales Contract, along with other required forms and Addendums signed by you, to the Southwest Alliance Regional office within 48 hours. You will be required to submit proof of financing from a lender or proof of cash to close, along with other items. You should be working with your broker to put the required items in place before you bid on a home, so that you are ready if your bid is acknowledged.
Closing on a HUD home
Closings are generally within 30-60 days and held at a closing agent office
After your contract has been received correctly, it will be signed by First Preston on behalf of HUD and returned to your agent along with a contract acceptance letter. The letter will give you up to 60 days to close. Once you are ready to close, you and your agent must schedule the date with the closing agent indicated on the letter, who also receives a copy of your contract. Southwest Alliance does not set the closing date with you or the closing agent office; it is up to you to do this. Your broker can assist you. If you use the HUD closing agent, HUD pays their fees. You may use your own agent, but then you must pay the fees. If you use your own closing agent, they must work with the HUD agent to close the seller side of the transaction.
HUD will pay some closing and sales commission costs
HUD will pay up to 5% for the broker commission. In addition HUD will pay up to 3% of closing costs. Upon closing of a HUD-owned home, HUD will allow deduction from its proceeds for purchaser financing and closing costs considered reasonable and customary for the jurisdiction in which the property is located. The buyer must indicate on HUD Form HUD-9548 (sales contract) the total dollar amount HUD is expected to pay towards a purchaser's financing and closing costs. However, in no event may the costs exceed three percent (3%) of the property's gross purchase price.
Return of Earnest Money
When you submit a contract, you must deposit earnest money with your agent (not Southwest Alliance), usually in an amount of $500 or $1,000. If you know your transaction will not close, your agent must notify Southwest Alliance as soon as possible so the home can be returned to the market. You may have to forfeit all or part of the earnest money if the sale does not close. If the sale is to an owner-occupant and does not close due to circumstances beyond their control, the money may be returned. Please review the earnest money policy for your area with your broker before you place a bid on a home.
Extensions of time
Extensions for time to close may be granted in 15-day increments, under certain circumstances. Extensions may be granted at no cost to owner- occupants under certain circumstances that are beyond their control, such as a delay in financing approval that is not due to the buyer. Extension fees may be charged under other circumstances. Extension requests must be submitted to the closing agent (not Southwest Alliance) in writing prior to the expiration of the original closing date, and accompanied by a non-refundable fee, in certified funds, if a fee is required. Contact your closing agent for more information on this process.
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*Call for details.
Any comparisons to a percentage commission, such as 6%, are for illustration and comparison
purposes only. Commissions are negotiable and not set by law. The information herein is
deemed to be accurate, but not guaranteed. All information to be verified.
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