is it possible to wholesale HUD properties?
It is my understanding that HUD will not allow assignments. You might be able to do a double close, but IÃ¢â¬â¢m not sure.
I've seen it done by buying the property from HUD in an LLC then selling the LLC.
You can also buy it in a trust and assign your beneficial interests to an end buyer
from my experience double closing is the best way to wholesale HUD
I don't have experience with double closings. On a HUD owner-occupied purchase with FHA 203k financing how would that work or would it be possible? Also, are there any limitations on refinancing a home with a FHA 203k loan (say 6 months after closing and after all repairs completed) or limitations on selling the home (after repairs).
Yes, you can wholesale HUD's. I've double closed 2 or 3 of them. They are just like any other REO but with even more red tape.
I don't know about the 203k financing. They are not going to like it when they see you flipping it, and I would hypothesize that there is a good chance they will shut it down.
Exactly what type of red tape did you run into, or what did you mean? I have a client who is wanting to get a HUD home and wants to wholesale it to a Rehabber. You think it might cause some problems? They were going to use transactional funding.
HUD will just require certain documentation from the wholesaler, including their financing information. I don't remember exactly what else they wanted. It wasn't anything crazy but it was a bigger pain in the butt than a typical wholesale deal or even another REO.
The title agent is key to the whole process. Make sure that you get to pick the title agent, and find one that is very comfortable with double closings.
I'm assuming your buyer put in his bid as an investor. If he put it in as a owner occupied then as a realtor I would run screaming from the deal.
Double closing are the best way to deal with huds...always best too to move the title company who is closing the file to a "friendlier" vendor who isn't worried about their hud contract. I've done hud same day flips in the past, no biggie.
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