Getting Feet Wet With HUD

[Michael Johnson]

I'm gearing up for my first deal. Yay! It's a HUD home, decent price I think, but I still need to do a little research on the comps and any necessary repairs.

Where I'm concerned is if there are any restrictions typically on HUD home purchases. Is there a "gotcha" I'm not seeing like minimum hold time or maximum resale price? Obviously market value has a limitation, but I was curious to see what your collective experiences were.

I did a little research here already on others buying HUD, but didn't see the answers to at least part of what I'm asking.

Thanks in advance

-Michael

[Jon Holdman]

A big potential gotcha with HUD is the earnest money. If you bid as an investor, win the bidding, and hand over your earnest money you will NEVER get it back. So you have to be sure you do any inspections before you make your offer. The usual inspection contingencies don't work with HUD.