Government Foreclosures in Arizona
Are you one of the many Arizonan’s wondering where do you go to purchase government foreclosures? Working with a Realtor, but he can’t explain how you buy HUD homes? The truth of the matter is that HUD homes are listed on the MLS that your agent has access to and all HUD home transactions involve a real estate agent, however, your agent may not be familiar with the process. You may have heard that buying HUD homes is difficult, but it is no more work then buying any foreclosed home. HUD homes are homes that had government backed loans.
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Buying HUD Homes FAQ
How does HUD determine the list price of HUD home for sale?
Buying Arizona HUD homes is a little different than buying a bank owned property. An “As Is” FHA appraisal determines the dollar amount that HUD lists AZ HUD homes for sale for. That’s right an FHA appraisal has been done for you on all AZ HUD homes.
No value is given to pools by the FHA appraiser for AZ HUD homes. Therefore, if you find a HUD home that has a pool it could mean the home is even more valuable than you think. These appraisals are currently good for four months. FHA insures your new FHA loan on HUD homes and is more lenient as to the condition of the home than they would be if you purchased something besides a HUD home.
Some purchasers are afraid to go after HUD homes because they have been told it is “blind bidding.” However, REO’s (bank owned real estate) are handled in somewhat the same manner. You make an offer on a property that most likely has multiple offers (15 to 20 in some cases), the listing agent does not tell you how much the other offers are for, then you are told to send your highest and best offer by a certain time. The Seller (the bank that owns the property) then determines which offer is most acceptable and will net them the most money. Hmmm… that sounds pretty much like buying a HUD home.
So why not have the option to checkout all of properties when looking for your next home? If an agent tells you HUD homes are not worth it they probably do not know how to sell them.
Why do I need to be represented by a Realtor when buying HUD homes?
All AZ HUD homes are listed on the Multiple Listing Service. To make an offer on a HUD home you must use a Realtor. There is no way around this. HUD pays your agent up to a 5% commission. The commission will be on your offer to HUD and you should be aware of what it is. Keep in mind that your agents fiduciary duties are to you, however, not to HUD. This means that you get full representation and HUD pays for it. Although a 5% commission may seem like a lot to you, keep in mind that agents work hard on these transactions. I may place several bids for you before you win one. In addition, many HUD homes are less than $100,000 which equals a $5,000 commission for doing the same amount of work an agent would do for a $10,000 commission on a $200,000 property.
Who is the listing agent of a HUD home?
Michaelson, Connor & Boul assumed the management and marketing duties for all HUD inventory in Arizona and Nevada. This does not mean that they represent Buyers in the transactions, however. They do not list the homes either. They assign the listings to various agents. The listing agent will only represent one buyer in these transactions, however. So you do need an agent on your side. There are many things you should know about buying HUD homes, so add this page to your favorites for future posts or contact me today at (480) 206-6425.
WHERE DO I FIND THE HUD HOMES LIST?
You can find the list of AZ HUD Homes at the Hud Home Store. This list is updated on Friday’s only, but you can check it out any day of the week. I can also set up a more specific list of HUD homes for you. This way you do not have to sift through the entire list, but rather look at HUD homes that suit your needs.
WHO CAN BID ON Arizona HUD HOMES?
Anyone who can qualify for a mortgage or has the cash can purchase a HUD home. All buyers must use a registered broker or agent. If you have to explain to your agent that they need to be registered to place a bid on a HUD property for you then do not use them. HUD homes are not difficult to buy, but they aren’t for the novice agent either.
How do I make an offer on a HUD home?
You need to get pre-approved for financing, have your earnest money and be able to close the transaction within 30 to 60 days of acceptance. There are no negotiations when buying a HUD home. This is a sealed bidding process. The offer that nets HUD the most money wins. Contact the Queen of HUD at (480)206-6425 to schedule a HUD homes tour. No obligation to buy is required. I will take you to view all the HUD homes for sale in your area.
How Do I Buy AZ HUD Homes?
First of all you do not need any sort of special list to find AZ HUD homes. AZ HUD homes are listed on the Multiple Listing Service and at MCB’s Website. Real estate agents have access to the Multiple Listing Service and can find you HUD homes with one phone call or you can sift through MCB’s list.
You should verify that your agent specializes in HUD homes as it is not an easy process. By this I mean it isn’t the easiest sale. Registered agents and brokers may place bids electronically for these properties on your behalf. I’ve had agents tell me in the past that there is no reason to make offers on HUD homes with all the bank owned properties on the market today. This is not true! If you want to see HUD homes then your agent should not be telling you that they are not worth it. If an agent tells you this run.
The bid that nets HUD the most money is selected.
Note for FHA buyers: If you overbid (bid more than the appraised value), on AZ HUD homes, you will be required to pay the difference in cash in order to close.