Hubzu

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Hubzu

David Brummond
Janesville, WI · Member since 2015 · 2 posts · 2 votes

I read an older discussion on the website Hubzu and having recently been involved in a sale with them, I felt an update was needed. Hubzu is an auction website for bank foreclosed properties. During the transaction I was involved in, I found that the info listed in the MLS to be inaccurate, and the broker non-responsive. The process is a maze designed to maximize the sale price. If you win the bid but have not met their reserve, they will offer a lower price. If you pass on that they will auction again and if you win they will make a slightly smaller offer. This continues until you agree. From this point forward you work with people from India. You will be given a choice of using their title company at no cost, or paying for a local title company to prepare the HUD and close. Their title co. is Premier Title out of Atlanta but you will be dealing with someone in India. Usually all liens are settled and you get a clear deed. But that does not mean that the local municipality does not have open claims for cleanup, utilities etc. At this point all correspondence is ignored which includes Premium Title. You may be better off paying a local title company to provide a real title policy, particularly if the municipality also supplies electricity and gas.

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Chris Simmons
Real Estate Agent · Owasso, OK · Member since 2014 · 517 posts · 400 votes
11y

sure.  And my rentals are all seperate llc's.  They are not at all related.  Totally unique, one has nothing to do with the other at all.  Just a pure coincidence.

http://www.thestreet.com/story/12083751/1/bill-erbey-made-23b-off-your-underwater-mortgage.html

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  • Bill Delo
    Investor · Irvine, CA · Member since 2016 · 8 posts · 0 votes
    10y
    I agree with the notes that the Hubzu process is challenging and frustrating, but it is possible to get good deals and get through the process. I close in 2 days on an SFR in San Antonio purchased through their site. It was 10th property we had bid on and the first to have a reserve price that was reasonable given repairs needed and the likely ARV. Patience is key I think, work the process, identify a property you like and do not overpay. General rules that will work for all purchases. On a side note have found their closing process to be quicker than Auction.com. Went under contract on an Auction.com property one day after Hubzu. Closing date has been postponed 3 times already and given that the current extension is for this Thursday and I have heard nothing it will be extended again. Hubzu property is financed (with HM) and is closing 1 week early. So be patient and follow their process and it is possible.
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  • Jason Arcuri
    Real Estate Agent · Southbury, CT · Member since 2013 · 160 posts · 98 votes
    10y

    I have such a love hate relationship with Hubzu.  Currently bidding on a house that has no end bid date.  WTF?  However, I just had a client buy a house for themselves off Hubzu where I was able to negotiate them down from 225 to 194 with 4k back.   They got a rehab loan and are going to be in to the total house for 230.  Appraiser said it was worth 280 and honestly he was using comps on houses that needed updates and didn't have a pool.  I put the house worth 300.  So happy for them.  Unfortunately it's not a flip so not really an investment.  They just get a home with a ton of equity.

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  • Account Closed
    Real Estate Agent · Richardson, TX · Member since 2014 · 511 posts · 161 votes
    10y

    Question to everyone who has used hubzu.

    1) Do they allow inspections? I read a comment of someone mentioning inspections. I thought they wouldn't allow you to have an inspection in the property.

    2) Are you responsible for any liens liens in the property?

    3) Property I'm bidding looks like a cosmetic rehab. However, I noticed it's CASH only. I'm noticing that in other properties they even allow conventional financing. Makes me think there might be some issues in the property I can't see (Plumbing, electrical etc)

    Any thoughts?

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  • Percy N.
    Developer · Philadelphia, PA · Member since 2015 · 2k+ posts · 905 votes
    10y
    Daniel Moctezuma , Inspection will vary by listing but more often than not will not be allowed. If they are, they will still not pay for anything, it's for your information only. The one I bought allowed for inspections but the home was winterized so utilities were not on. I just walked it with my contractor. Some copper was missing so plumbing would fail anyway, as it does in most REOs. If it asks for cash, that means there is something that is required to be fixed prior to a mortgage being applied (sewer, plumbing, roof, etc) or the bank has had a few deals with financing fall through and they want to get out of the deal. Since it is cash only, I would but in a lower offer and see what happens. Don't be surprised if they contact you even if you are not the initial winning bidder. BTW, we closed in under 30 days using our own title company and a cash purchase.
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  • Betty Cruz
    San Antonio, TX · Member since 2016 · 240 posts · 163 votes
    9y

    @Account Closed, am interested to know about liens on these properties. Might they not have clear titles?

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  • Alice Tong
    Wallingford, CT · Member since 2016 · 1 post · 1 vote
    9y

    This statement is directly from HUBZU on closing.   "Buyer, Seller and Agent Responsibilities   The seller will provide an insurable title at closing."

    When I look up insurable title as appose to a marketable title, this is what I find.

    If  a seller under the contract gives the buyer marketable title at closing (not insurable title), this means the seller must remedy any defects in title prior to closing, such as the seller paying off any liens, or doing all the work necessary to get the liens removed, etc. Thus, at closing the defects have been cured by the seller.

     By contrast, a seller giving you insurable title does not require the seller to cure title problems at closing. It means only that these problems are insured post-closing under the terms of your title insurance. The closing is completed with these title defects unresolved.

    Here is the rub. Insurable title means the title insurance will step in after the closing and defend the buyer but only if any of the lien or judgment holders actually step forward and levy the claim against the real property. Thus, only then will the title insurance company defend and cure these claims. This sounds great, doesn’t it? Well, yes, but only to some degree. Insurable title enables a smooth closing when you purchase the foreclosure property; but, it also makes the title defects potential sleeping giants.

    And, even if the giants never awaken, when you later sell the property your buyer will most likely require that you convey marketable title (which is typically the case). In order for you to transfer marketable title, you will have to do all the work (including possible negotiation and payment to satisfy the liens, judgments, etc.) so that you can transfer a deed at your closing that is free of title defects. In other words, you are responsible for the title clean-up when you later sell the foreclosure property.

    Finally, in some cases the title defects are so great that the title insurance company will not insure even with this insurable title.

    Hubzu may be unpleasant and frustrating to deal with.  Can you imagine being stuck with a bad title that prevents you from flipping your house!  

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  • Account Closed
    Upper Marlboro, MD · Member since 2016 · 46 posts · 10 votes
    9y

    Do I need a real estate agent to purchase the house on HUBZU? Or can I purchase it myself?

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  • Betty Cruz
    San Antonio, TX · Member since 2016 · 240 posts · 163 votes
    9y

    @Account Closed It's not required that you have a Realtor, but when you register there is a place to enter your Realtor's name and info if you have one.

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  • Stephanie Southerland
    Real Estate Agent · Safford, AZ · Member since 2016 · 53 posts · 21 votes
    9y

    I am currently the highest bidder on a property through HUBZU. I know it hasn't met reserve and I refuse to pay over 30K for it. It has been on the market forever, and watching the market in that particular area, it will not be a profitable flip unless we can get it for 30 or under. It has been up for auction serveral times, yet no one is buying. The amount of work needed on this property is between 30 and 40K. What I am starting to hate about this whole process is that there is no communication process by which you can actually lay out the rehab numbers to the selling party to make your stand. If someone is crazy enough to pay more than I am willing to pay, they can have at it, but I don't see anyone paying more than that.  Just wondering how long it will be before the price actually gets in range and they accept my bid

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  • Kevin Norton
    Involved In Real Estate · Quincy, MA · Member since 2014 · 13 posts · 5 votes
    9y

    Hubzu is a farce...!!! I suggest spending your valuable property research time elsewhere.!! I was just recently the high bidder on a property that has been sitting vacant for over 5 yrs... Knowing the condition and occupancy status which was vacant (even though Hubzu stated occupied on website property bid page.?) My guess on that miscue is most likely their excuse for not having to have a Broker supplied and available to show it to prospective buyers...just have the buyers think it is occupied, less work for Hubzu and their agents..?? Soon after the winning bid the website states the status of property and bid is Under Review, so I wait...following day after sale no phone call or email from Hubzu...so I wait...2nd day after sale still no phone call or email from Hubzu. Basically your high bid is just an opportunity for Hubzu to offer you a choice on the website to raise your bid higher to reach the "Seller's Price"? Huh...?? Maybe the name of the auction website should be Huhzoo...!!

    Is this truly an auction process...?? I think not...!! I have purchased many properties at local foreclosure auctions and the high bid you make and win is the price you pay...!! Can you imagine a scenario where a live auction is taking place and the Auctioneer cries out "Sold...!!". You as the high bidder, ready to fill out the purchase contract, is told by the Auctioneer that you have to pay a higher price if you want to actually buy the property. Is that really ethical and good business practice..?? I don't think the Auctioneer and the foreclosing Bank would be in business too much longer after they continue this shady process. 

    My opinion is to stay away from these on-line auction websites and spend your time more wisely hunting down deals through local Brokers and other Investor/Wholesalers. I wasted a lot of time with this misleading process of on-line bidding...Can I call over to India and have them pay me for my time spent on this wasted endeavor...!!! Thanks for nothing Altisource and Hubzu (Huhzoo...!!)

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  • James Barnhart
    Rental Property Investor · Ocala, FL · Member since 2016 · 226 posts · 140 votes
    9y

    Our Realtor bid on a Hubzu auction for us.  That house was auctioned twice in 10 days.  The second time, the Realtor said a man from Hubzu indicated that we were the highest bid, but actually we were not.  There were 2 bids of the same exact amount that were $2000 higher than ours that we saw online in the bidding process.   But, then a man from India said we could buy the house for $2000 more than what we bid.  We declined, because in addition to the sales price, there were additional commissions and fees that would add about $6k more.  Hubzu seems to be non professional and maybe somewhat shady.  

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