HUD home loan?

House is in foreclosure, what to look out for? Sorry to be so vague but I could use some guidance on where there be Dragons.

Very careful inspection of the house as you won't be able to get the seller (the bank) to fix anything?

I'd also look into chain of title issues very closely, you want to make sure that whoever foreclosed had authority to do so and has clean title to the property.

IN foreclosure or already been foreclosed upon?

Been foreclosed and empty,sorry.

By HUD loan, I assume that you mean an FHA loan; the caviat with those is that they cannot close if there is any deferred maintenance (peeling paint, broken windows, non-opperative mechanicals etc.) required on the home as disclosed in the appraisal. Conventional loans (Fannie/Freddie) are more lienient in that regard, but will require a bigger downstroke.

The lender that you work with won't close you if there are title issues (liens, encumbrances, etc.)...but if there are it may take a while to iron those out (with the seller/bank)...and depending on the owner/seller (bank), they could make you pay those at close, so put in your offer that the seller will be responsible for any outstanding title concerns.

HUD loans are different and if you must get special financing to buy the home then there are things wrong with the house or area that make it so that you want to run screaming away.

Foreclosures are a bid process and the person who will pay the most gets it. This is not good for buyers.

They also are as-is where-is and if things happen after contract time such as people stealing the AC units you still have to buy the home.

The Realtor gets paid double the commission to try to entice you to buy a foreclosure.

HUD owned home with a Rural development loan?

USDA RD uses same FHA deferred maintanence clause...and you can't have an inground pool with USDA (go figure). RD loans are nice though--100% 30-fixed with no MI...and good rates.

Realtor says I can't look at last appraisal? Requires $1000.00 earnest money(No less?) 3.85% interest for a 30 year fixed. What am I missing ? I trust Realtors even less than used car salesmen.

Let's see... the Realtor is an agent of the owner, and the owner is the US department of Housing and Urban Development. Why can't you see the appraisal? Sounds like public information.

My first house was a HUD house. Deal went well. Da rules iz da rules, and there was not much room to color outside the lines. I had to do everything the way they said, but the Realtor walked us through every detail.

My questions were much like yours since an appraisal is the linchpin the whole deal works off of.Fishy?

ST_ZX2 wrote: USDA RD uses same FHA deferred maintanence clause...and you can't have an inground pool with USDA (go figure). RD loans are nice though--100% 30-fixed with no MI...and good rates.

Yes, you can!!! We've fought that fight and won.

USDA will also sometimes say you have too much money in the bank to get one of their loans or say you can't put a downpayment, but both of those are due to the underwriters not knowing the rules. Fortunately WE DO!

Not necessarily fishy.

Realtors get funny when they are dealing with government regs. Wouldn't shock me that they were overly cautious.

Plus, there are always a lot of tire kickers with HUD houses. One way to weed them out would be to require the deposit before giving much more info. Mine was a very long time ago so I don't remember the details, but there may have been a similar deposit requirement.

I can't imagine how you wouldn't get your money back if the deal did not move forward. It one thing for a Realtor to be concerned about state licensing regs. It's a whole different game to fraudulent play with federal regs. In this case, they would have to answer to both.

bottom line, don't pay more than you're willing to pay. Watch out for fee's, charges, taxes, etc at closeing. Cost me an extra 3500 or so.. ouch

House looks pretty well maintained . No inground pool. Is there a cheaper rate than a commercial mega bank offers?Where are these rules written?Can commoners see them?

Ask your Realtor about the specifics of the sale and the bid process.

Under the new rules and regulations if 12 different lenders knew the same thing about you and were checking for rates on the same day & time it would be highly unlikely that someone would have a different rates. Things have been standardized now.

Either you fit their standards or you can't even get a loan of any type.

Same thing for closing costs. They are what they are.

BTW the Realtor isn't working FOR you, they are working WITH you.

carguy123 wrote:

ST_ZX2 wrote: USDA RD uses same FHA deferred maintanence clause...and you can't have an inground pool with USDA (go figure). RD loans are nice though--100% 30-fixed with no MI...and good rates.

Yes, you can!!! We've fought that fight and won. USDA will also sometimes say you have too much money in the bank to get one of their loans or say you can't put a downpayment, but both of those are due to the underwriters not knowing the rules. Fortunately WE DO!

I got out of originating last year--seems you are correct; they loosened the pool guideline earlier this year. Does USDA still have an income cap (if you earn too much, you're ineligible...)?

Yes, the property must be located in a lower density area and there is an income cap that varies by county and number in the family.