Did I get taken for a ride on a HUD bid by my broker?

[Greg Nolan]

Hi everyone, I'm in the process of making my first HUD auction purchase and I think the listing broker was not upfront with me.

I found a good deal on a property and went to see it, liked it and discussed the bidding process with the listing broker. We decided to put in a bid at $50 dollars over the minimum in order to beat out anyone bidding just at the lowest price.

What I didn't understand at the time is that HUD picks the winning bid on a NET basis after commissions are taken out, and the selling broker put herself down for 3% on both sides of the deal for a total of 6% which reduced my ACTUAL bid by an extra 3%! I could have just offered 3% less and the broker is instead taking that as a commission.

We luckily won the auction anyway but I still feel that I was robbed of 3% of the purchase price, or at the very least she put our deal at risk by knocking 3% (thousands of dollars) off of my bid while letting me feel clever about bidding a piddling $50 more.

Is this common practice? If not; is there a remedy for this? or am I just going to have to chalk this up to another RE learning experience for next time?

I don't begrudge anyone their commissions, but this felt wrong to me.