Questions and Answers about HUD Homes.

What is a HUD Home?

A HUD Home may be a single-family house, a townhome, condominium or other type of residence. The properties were deeded to HUD/FHA by mortgage companies who had foreclosed on FHA-insured mortgage loans. Now HUD must sell these homes--as quickly as possible at market value--in order to obtain the maximum financial return on its mortgage insurance funds.

Who can buy a HUD Home?

Anyone who has the money or can qualify for the necessary amount of mortgage financing can purchase a HUD Home. You do not have to be low-income or meet any other such limitations.

Can I get a HUD Home for free, or for one dollar?

No. HUD acquires its properties through the foreclosure of FHA insured mortgages. One of HUD's many missions is to maximize return to the FHA insurance fund, which it does by selling the properties at fair market value.

How do I buy a HUD Home?

Our policy is to market acquired properties on a competitive basis with sealed bid offers being submitted through any participating licensed real estate broker. Local brokers will assist you in the transaction. They can show the property to prospective buyers, as well as answer questions and provide information on the location of parks, schools, shopping, and employment centers.

Are HUD Homes meant for low income people?

HUD Homes come in a variety of price ranges, though most are affordably priced, making them accessible to low and moderate income Americans.

What are the income requirements?

If you make a cash purchase, there are no income requirements. Otherwise, you must be able to qualify for a particular type of mortgage financing based on established mortgage lending criteria.


How does HUD Decide how much to charge for a HUD Home?

The listing price of a HUD property is HUD's estimate of its fair market value. HUD establishes value by comparing HUD properties to similar properties sold within the community in the previous six-month period.

Can investors purchase HUD Homes?

Yes. However, HUD offers its properties to owner/occupants for a period before making them available to investors.

What happens if I can't close the sale within the time permitted by HUD?

You'll probably have to pay fees for an extension of time, usually in increments of 15 days.



There are three major credit reporting companies: Equifax, Experian, and Trans Union.

Credit Reporting Companies


Company Name Phone Number
Experian  1-888-524-3666
Equifax  1-800-685-1111
Trans Union 1-800-916-8800



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What are the guidelines for purchasing a property on someone else's behalf? For example, I am a parent and I wish to purchase a property for my child. Is this allowed? Yes. The person or persons that will actually be occupying the property must be the purchasers listed on the electronic bid. If accepted, then the person or persons financing the purchase may be added later as non-occupying purchasers. Offers for these situations may be submitted during the Owner Occupant period. What is the difference between an Owner Occupant purchaser and an Investor purchaser? An Owner Occupant purchaser is a person who plans to live in the property as their primary residence for the first 12 months after the close of escrow and has not purchased another HUD Home as an Owner Occupant within the past 24 months. An Investor purchaser is someone who buys the property as a second home or as an investment, or who does not qualify as an owner occupant. When can an investor purchaser submit an offer for a property? Investors may submit a bid once a property enters the Extended Listing Period. This period begins once the Exclusive Listing Period is over. If the property is being sold as Insured (IN) or Insured with Escrow (IE), the Exclusive Listing Period is 15 days for Owner Occupant purchasers, Non-Profit Organizations, and Government Entities - please be advised that when we refer to days on market we mean active days on market. Bids received during the first 10 days are considered to be received simultaneously, and the initial bid review is on the 11th day of the Exclusive Listing Period. If there is no winning bid, bids continue to be reviewed on a daily basis until the 15-day period ends. If the property is Uninsured (UI) or Uninsured 203(k) eligible (UK), the Exclusive Listing Period is 5 days for owner-occupant buyers, non-profit organizations, and government entities. Bids received during these 5 days are considered as though they are received simultaneously, and are not opened until the 6th day of the Exclusive Listing Period. When can the buyer get a home inspection done? The buyer has a 15 day period after contract ratification (execution) to activate utilities and complete the home inspection. All inspections, tests, and risk assessments are performed at the purchaser's expense.