Buying a HUD home in the Las Vegas area is definitely another primary residence or investment alternative. FHA loans have increased dramatically over the past couple of years due to the decreasing prices of Las Vegas Homes. Therefore, expect to see the number of HUD homes available to increase.
What is a HUD Home?
Step 1 - (FOR AGENTS) Register as a Bidder on HUDHomeStore.com
- The principal broker must be registered with HUD and be issued an NAID number in order to submit valid bids. Agents - your broker must be registered first before you can register.
- Agents - To register with HUD, select "Bidder" on the upper right hand corner of HUDHomeStore.com home page.
- Real Estate agents need their Brokers NAID #, your real estate license number, date of issuance and expiration date to register.
Step 2 - Find HUD properties for your buyer
- HUD properties can be found in the GLVAR Multiple Listing Service (Agent tip: Search for "HUDHomeStore.com in agent-to-agent remarkks) or on HUDHomeStore.com
- HUD properties are listed daily - so check the HUD website or MLS often
- All HUD listings are on electronic or manual lockboxes
- Buyers must use a HUD registered and licensed real estate agent to submit HUD bids.
- Financing Types:
IN (Insurable) – these properties qualify for FHA 203(b) financing and have no obvious Minimum Property Standard (MPS) repairs. These properties may also qualify for 203(k) financing, a rehabilitation loan for
owner occupants only.
IE (Insurable with Escrow) – these properties qualify for FHA 203(b) with Repair Escrow, and have MPS repairs totaling less than $5,000. The repair escrow is the buyer’s financial responsibility, never a credit to the buyer. The lender holds the repair escrow money until completed (which must be within 90 days after closing) and is responsible for disbursing the funds to the appropriate parties. The escrow repair amount only applies to FHA 203(b) financing. These properties may also qualify for 203(k) financing.
UI (Uninsurable) – these properties do not qualify for FHA 203(b) financing. Typically these properties have MPS repairs exceeding $5,000 or may not meet other guidelines for FHA financing.
UK (Uninsurable, 203k Eligible) – these properties do not qualify for FHA 203(b) financing, but mayqualify for 203(k) financing.
- Property Availability and Bid Deadlines:
Properties listed as IN and IE are available exclusively for owner occupant, nonprofit and government agency bidders for the first 30 days on the market. Please note the initial bid review is on the 11th day of listing. All bids received during the first 10 days are opened and reviewed simultaneously. If no acceptable offers are received, bids are reviewed daily (Mon. – Fri.) until the exclusive 30 day owner occupant period expires. Properties are then available for all bidders, with bids reviewed daily (Mon. – Fri.).
Step 3 - Complete the appropriate Sales Contract Package (Investor or Owner-Occupant)
- All the necessary Forms, Contracts and Addenda are located at BLB Resources or at HUDHomeStore.com, property detail view - click on Addendum tab
- At BLB Resources, you can also download the Selling Broker Handbook, Selling Broker Quick Reference Guide, How to Complete a HUD Sales Contract Package
- HUD will pay up to 3% towards buyers closing costs
- NOTE: HUD pays the full escrow fee - Buyer will not be charged 1/2 escrow fee. However, all other "normal" seller closing costs will be charged to the buyer (Transfer tax, Owner's Title policy, Recording fees).
- All signatures must be in Blue ink
- Remember, the highest net to HUD is the winning bid - basically the offer price less any requested closing costs and commission (HUD will pay a commission up to 3% of sales price).
Step 4 - Submit the Bid Online at HUDHomestore.com
- All bids are submitted electronically directly on the HUDHomeStore website and are considered simultaneous bids. You must have the complete contract and all disclosures completed and signed by the buyer prior to submitting the bid.
- Bid deadline time is 9:59 pm (PST)
- Simply locate the property on HUDHomeStore.com and click on "Submit an Offer" and complete all the necessary fields using your completed contract as a guide.
Step 5 - Winning Bids and Closing Procedures
- HUD will notify the winning bidder (Agent) via email typically within 24-48 hours.
- If your bid is accepted, the completed, original sales package must be delivered (over-nighted) to BLB Resources within 2 business days.
- Earnest Money Deposit must be in certified funds and made payable to "HUD or (Purchaser's Name)"
- Cash offers - provide prrof of funds. Offers with financing - submit lender pre-qualification letter of Loan Status Report (LSR)
- Nevada HUD Closing Agent:
5390 Kietzke Lane, Suite 101
Reno, NV 89511
NV HUD Hotline: 702-530-HUD1 (4831)
HUD Tech Support: 866-777-2034
Check out the comprehensive www.HUD.gov site for extensive and useful information.
If you are a buyer or investor interested in a Nevada HUD home, just give me a call (702-858-9191 or email me at email@example.com) and I will be happy to refer you to an experienced real estate agent who can assist you.