HUD Homes Info

Learn how the HUD system works
HUD Homes Info

HUD homes are a great opportunity for owner occupied buyers to get a great deal. HUD’s process is a little different from most seller’s, but if you know how the HUD system works, it becomes easy to buy HUD homes. If you know the system and what to expect you can get a great house for a great price.

In the last year it has become much more difficult to find a great deal on a house. Many buyers looking for a home are a bit overwhelmed at how fast the market has changed due to low inventory. There are still some good deals out there and HUD homes have some of the best prices around. HUD homes are properties that were purchased with a FHA loan that was foreclosed on. Because the government insured FHA loans, many of these properties go back to the government and become HUD homes. Purchasing HUD homes are a great way for owner occupied buyers to buy a home, because HUD gives priority to owner occupied buyers over investors.

What makes HUD homes different from other types of listings?

Purchasing HUD homes is very different from purchasing any other type of property. The offering process, contract process, inspection process, closing process and loan process are all a little different with HUD. I am going to go into detail on how to bid, how to close and everything in between with a HUD home. I hope this guide and your local Realtor can help you successfully purchase a HUD home!

HUD uses different asset management companies to sell their homes

HUD uses asset management companies to sell and manage HUD homes and HUD uses property preservation companies to maintain HUD homes. An asset management company overlooks the bid process, contracts and helps close HUD homes, they also hire local real estate agents to list HUD homes. Property preservation companies take care of routine maintenance on HUD homes, winterizations and emergency repairs. Each region in the country has different asset management companies and different preservation companies. Each company has different policies on the sales of HUD homes. If you see a HUD home listing from one company, you may not encounter the exact same procedures from another company.

Where can you find HUD homes?

The most important thing to know about HUD is HUDHOMESTORE.COM. HUD lists every house they have for sale on this website and anyone can view them. It is very simple to search for homes on, the search function is on the home page and all you have to enter is the state and any other search criteria. If you want to narrow it down to city, zip code, county or address you can search for any of those items one at a time or all at once. Only active HUD listings are listed on .com, if a home is under contract it will not show up in your searches. There are a few other reasons the property many not be on the site including price changes or if HUD ordered a new appraisal. If you can’t find details on a HUD home ask you’re Realtor and they should be able to figure out the status. There are some cases where a HUD home is only available to a special group of buyers and in those cases the home may not be in the MLS.

When can owner occupied buyers bid on HUD homes?

HUD has an initial bid period for owner occupants, non profits and government agencies only. To make things simpler I will refer to this bid period as the owner occupied only bid period from now on. HUD classifies properties into different categories based on condition and those properties have different bid periods. Some properties will qualify for FHA financing and some won’t depending on the amount of repairs needed. The properties that will go FHA are listed as “insured” and the properties that won’t are listed as “uninsured”.

If a property is listed as insured, there is a 15 day owner occupied bid period with a 10 day initial bid period. HUD accepts bids for the first 10 days and then will review bids the next business day after the first 10 days are up. If HUD does not accept a bid in the first 10 days, the home will go to a daily owner occupied bid period. HUD will review all bids received the next business day after they are received until the property has been on the market for 15 days. On the 16th day the home has been actively listed, Investors are able to place a bid on the property. HUD lists the exact amount of time left in the bid period at

If a property is uninsured, there is an initial 5 day owner occupied bid period. HUD will review all bids received on the next business day after the 5th day and if no bids are accepted, investors can bid on the 6th day.

If you see a property still on the day after the bid period has expired it does not mean the home is still available.  HUD reviews bids the next business day and if the bid period ends on a weekend, HUD will allow bidders to place bids after the initial bid periods have ended. HUD homes may also appear on hudhomestore for a short time in the morning after a bid period ends, because HUD has not reviewed the bid yet. HUD removes them after they accept bids and it can take some time to review bids on thousands of properties across the country.

How long does an owner occupant have to live in a HUD home?

HUD requires an owner occupant bidder to live in a HUD home for at least one year after they purchase the home. HUD does allow an owner occupant 60 days to repair a home, before the occupant must move in. HUD only allows individuals to purchase a HUD home as an owner occupant once every two years. You can purchase a HUD home as an investor as often as you like.

How does an owner occupied buyer submit a bid on a HUD home?

Every buyer must use a Real Estate agent registered with HUD to submit a bid on a HUD home. If you are shopping for an agent and you are interested in HUD homes, ask your agent if their company has an NAID number. If they don’t have an NAID number then they can’t submit a bid for you. Any office can get an NAID, but it can take up to few weeks to get an NAID number from HUD. If your agent’s office has an NAID they can register on and submit a bid for you very easily. The bid is submitted online and no documents are uploaded with the bid. HUD does require the social security, tax identification or EIN number for the purchaser to submit the bid.

If your does not have a NAID number, we can help your agent on how to become a registered HUD agent, just have your agent contact our office.