How to make money with HUD properties?
Ok guys, so I heard an audio in a blog of a well known wholesaler, it was a success story. I want you to explain to me if I understand right.
So this guy made an offer on a HUD home, his offer was accepted, he had to give $500 earnest money ($500 only because the price of the house was set below 50K)...
HUD gives him (anybody) 45 days to close...
Well this guy did not need to get financing lined up, because he was planning to sell this deal, so he started to market this property hard, point is he found a buyer that offered him more than his original bid to HUD.
I dont remember if he used transactional funding or not but point is he walked out of this deal with $8,500 after paying all the closing fees...
I just wanted to know if this is as simple as he made it sound? I understand that if he did not find a buyer and was not planning on purchasing the property he could have lost his $500... But really is this possible, HUD being part of the government doesnt care that you buy the house from them and in less then 2 hours sell it for a profit?
Im just curious to know this actually works this way. If thats the case I want to start making some offers and hope they get accepted if they do Ill market the deal as much as possible and hope I find a buyer (which I should if the deal is good enough) and if not be prepared to lose the earnest money...