HUD won't give me keys

[Donald Brinkley]

I settle on my first HUD foreclosure next Thursday which, other than 2-week settlement delay, has gone pretty smoothly I think. That is until I learned today that HUD isn't giving me the keys for the property at closing. They are sighting liability concerns and essentially by not giving me the keys forcing me to rekey or change the locks on the property thereby ensuring some contractor who made a copy can't break in after closing. It seems that this is throwing the baby out with the bathwater, but I get the concept they are going for at least.

However, this makes me scratch my head. Is this a normal HUD policy or just this specific listing agent being strange? If it's normal, how do you more seasoned investors handle this? Is a locksmith charge just a normal charge for every HUD property? Or is this just an agent being strange and not something I should worry about coming up with a process for handling as I won't see it often?

My agency doing the final walk through said I can "carry the key with me" to closing and if I happen to make a stop at a local hardware store who's to know.  Or she said we can just leave the door unlocked for the few hours we are gone.  So hopefully one of them work out.  But other than that, how would you handle the situation?  Any other ideas?

Thanks!

[Mike H.]

The real reason they won't give you the keys is if they did, then you could get in to any hud home in your area. Or at last a certain percentage of hud homes in your area.

Here in illinois, there are 3 asset managers that manage hud homes. And every realtor that is licensed to do hud deals has a copy of all 3 keys so they can let their buyers in.

If they were to give you a key, then you would technically have a key that would get you into a significant number of hud homes.  That is the real reason hud won't give keys.

I have done over 40 hud homes over the years and have never gotten a key from them. I just have my contractors drill a hole in the locks and yank them out.

About a year ago, I actually had the listing agent threaten to press charges because I did that and got rid of his lockbox. He tried to say I should not have tampered with the lockbox and that those are hud keys and he was going to report me or my realtor.

I told him to take a flying leap. I gave him a day to get off his butt to get his lockbox and he was too lazy to do it. He knew when the closing was. And that I am not going to leave those existing locks on the doors because every realtor on the planet has the keys to get inside my house.

Once the house closes, everything in the house is mine to do with as I see fit. If that means pitching his lockboxes, then so be it.  To be honest, I normally will just have the contractor set the lockboxes to the side on the porch but when this guy threatened me, he lost that courtesy for good. 

Had another closing on one of his listings 3 weeks ago. Had my realtor send him a reminder that if he wanted his stuff he better get it before the closing or else it was going in the dumpster and he could get dig for it in there.