Buying a HUD Home Part 1: How I Acquired 4 Homes in Under 2 Years

August 16th, 2007

Buying a HUD Home can be a daunting task. There is a lot of red tape surrounding anything that involves a federal agency. In this post I am going to reveal the exact method I use to effectively buying HUD homes at significantly discounted prices. In less than 2 years, I have effectively acquired 4 HUD homes for between 60% and 80% of their market value. If you are just beginning, I would recommend that you read the following posts before continuing:

Pay particular attention to the last article listed, as you can download the xls spreadsheet and use it to help you produce a bid that may seem low, but will allow you to estimate your offer price per your desired profit ambitions. If you have read and agree to “The One Key to Real Estate Investing“, than you will not think that your offer is too low. However, what has frustrated me in working with sellers that privately own real estate is that they think that they should get an offer that is very close to their asking price, and are unwilling to negotiate. I have submitted countless offers to sellers attempting to acquire a property at a price I know I will make money at, all to no avail. Even if you are able to find a home where a seller is truly desperate, you are often faced with many more road blocks that will derail your contract and drive you bonkers; which is why I turned to HUD home buying tactics.

A quick example of a would be deal I had with a woman who was going through a divorce. I came up with an offer that would work for me, and the seller, but the realtor killed the deal. She knew that the owner’s note was greater than my offer amount, and did not want to put in the work necessary to foster a short sale. While I am a realtor myself, I must say that most realtors out there are worthless, and provide no value while charging a ridiculous 6%. All that most realtors do for you is list your property in the multiple listing service (MLS), stick a sign in the yard, and wait for another agent to bring them a buyer. The real power is in the MLS, which is the second reason why I became a realtor myself (the number 1 reason is to keep most of the sales commission myself).

OK! Enough ranting about why most realtors aren’t worth throwing peanuts at. Let’s look at the method I use for buying a HUD home. There are 3 basic steps to buying a HUD home for less:

Knowing the HUD Listing System
Timing Your Offer
Don’t Worry about the paperwork

Go to Buying a HUD Home Part 2: How I Acquired 4 Homes in Under 2 Years…

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4 Responses to “Buying a HUD Home Part 1: How I Acquired 4 Homes in Under 2 Years”

Buying a HUD Home Part 2: How I Acquired 4 Homes in Under 2 Years Says:
August 16th, 2007 at 8:28 am

[…] Previous Articles in this series: Buying a HUD Home Part 1: How I Acquired 4 Homes in Under 2 Years […]

Paul Jacobs Says:
September 28th, 2007 at 12:56 am

I’d never give my address, but what really sucks is I wrote a very in depth question and because I didn’t put something in one of the above boxes it totally erased everything I wrote when I hit ‘back’. THAT sucks…I’d suggest you fix that! I spent a good half hour on it! yeah, yeah,…I know,,write it in word, right? Well, sometimes you might not think you are going to write that much.

Real Estate Investment Cash Flow Says:
October 2nd, 2007 at 9:35 am

[…] There are many ways to find and acquire investment properties at a discount. Probing for houses such as tax sale properties, HUD foreclosures, Bank foreclosures, probate properties, and otherwise distressed properties are the best types of properties to go after. Seller’s must be motivated, or you will not be able to get the property at a discount. My main focus has been on HUD properties, and at www.bidselect.com, you can find the current list of available properties for sale. In a later edition, I will define and give you some quick pointers on the other types of distressed properties. But HUD properties are the simplest to acquire; you just have your realtor submit a bid, and the day after the bid deadline, you get an answer. Read the full detail of how I buy HUD homes. […]

Repossessed Mobile Home Offers Says:
November 7th, 2007 at 6:17 pm

[…] a double wide mobile home with the land in an outlying area of the town I live in. It was a HUD repossessed mobile home, and I purchased it for $26,500. It is a 2002 Palm Harbor 3 bedroom, 2 […]