Eligibility

• As long as you have the cash or can qualify for a mortgage, you are eligible to purchase a HUD-owned single-family residence. Employees of HUD or relatives of employees must be granted written approval from the director of HUD's Single Family Asset Management, before they can purchase a HUD home. HUD homes are initially offered to buyers who intend to purchase the home for their primary residence. After this initial priority period for owner occupants, unsold properties become available to investors as well.
  
  

Process

• HUD homes are sold through a bidding process. During the initial Offer Period, HUD will accept sealed bids from your real estate agent. Once the Offer Period has ended and all bids have been received, HUD will typically accept the highest offer or the bid that earns it the largest net. If your bid is accepted, your agent gets notified by HUD within a couple of days. A settlement date will be assigned to you, usually 30 to 60 days from the date HUD accepted your sales contract.
  
  

Inspections

• It is strongly recommended that you acquire a professional inspection of a HUD property prior to submitting an offer. HUD will not pay for repairs to a home, and the property is sold unwarrantied and "as-is." Typically HUD's asking price for a property reflects the fact that the new owner may have to invest additional money for improvements.
  
  

Financing

• If your bid is accepted by HUD, you will be required to submit an earnest money deposit to demonstrate commitment to buy and to bind the contract. If you fail to obtain financing and close the sale within the 30- to 60-day settlement period, you will forfeit the earnest money deposit, or you pay for an extension on your sales contract. HUD does not offer financing. You will need to acquire financing through a traditional lending institution or use your own cash reserves. If the HUD home you buy is in need of numerous repairs, you may be able to qualify for an FHA 203(k) Rehabilitation Loan. Additional information can be found on HUD's website.
  
  

Locating HUD Homes

• Listings for HUD homes can be found online at the HUD Home Store. There are several other websites that offer HUD listings, such as Foreclosure.com and HomeSales.gov. Properties can also be found through your real estate agent, who will have access to the Multiple Listing Service (MLS), which lists all properties available for sale. Your agent will also be able to provide you with more detailed information regarding HUD home guidelines.