HUD Price Reduction vs. ARV questions?
Hi all...Jugo here.
I"m currently shopping for a loan for my 1st home purchase, and I had a question about HUD and was hoping, no, counting on the pros here to answer a few pertinent questions I know several rookies here have thought about also..
Thanks for your timely response in advance....
Question 1: When a HUD home is "Price Reduced", does the buyer recieve the difference to the amount of his ARV?
For example: Reduced Price: 52K
Original Sale Price: 65K
ARV (comp) : 82K
What would the GROSS equity be when I purchase this property? Do I subtract the difference of the Reduced price vs. ARV to get TOTAL equity amount? In this example, would it be 30K? I KNOW HUD factors ONLY as-is value when pricing if the home has been sitting for awhile, which is why it's reduced in the 1st place.
In full disclosure, I am FULLY aware that repairs, etc. play a role in HOW MUCH equity will be available after purchase but just want to know what / how to calculate equity ONLY. Thanks.
I'm finding some really HOT deals on HUD website, but want to cross T's before jumping into a home I'm hoping will bank me and not break me.
Question 2: Has anyone purchased an HUD home using FHA financing?
Their website mentions a $100 down payment if financed using FHA! Count me in like Bingo if this is the case!
If so, how many properties can you purchase before you're able to buy another using $100 dp? I'm guessing that once you show proof that your CURRENT home(s) are rented, you can repeat the process again using the same methods?
Thanks for any and all input....
Jugganaut
"you are NOT your job, you are NOT your car, you are NOT your f'in khakies!" -Tyler Durden (Fight Club)