HUD Law/ethics question Frim put investor bid in during occupant

[John Nisewonger]

I am a local investor and had watched a particular HUD property for some time. HUD allows certain types of bidders during certain periods. Occupants and no profits get to bid in the first period. If no bidders, it opens up for bidding for investors. The real estate firm submitted a bid for an investor during the period for owner occupants.

The day that HUD opened up the bidding for investors I was ready to put in a full price bid. I had spoken to my agent and also had my funds set up to purchase. Mid day I got a call from my lender saying that he didn't see the house on HUD anymore and wanted to know what happened (I think he needed some info from the listing). I contacted the listing agent and she explained what happened. She stated that one of her new agents submitted a bid for an investor and that HUD has accepted (thinking it was for an owner occupant). She told me that she would call HUD and that the house would go back up for sale in the next day or so. The house never went back up. I checked the county records and it is clear that an investor picked up the propertyHis house is worth over $300,000 and I am sure he is not moving to a $50,000 fixer upper that was a total gut job. I am not sure why HUD would let that go through if there was a mistake. That leads me to think she never called. Why would she when she can get both buyer and seller broker fees buy not letting me have it in which I was using another brokerage firm. This behavior is unethical and unfair to other investors.

Someone is acting unethical. This deal should have never went through. I play by the rules and so should everyone else. This particular mess up potentially cost me around $20-25k in profits. 

I have already contacted HUD about the matter and they just state that they will investigate it. Do you think they just went ahead and took the bid?

Is it worth the time to submit a complaint to DPOR? I really am not sure who is at fault but someone acted unethically.  Your thoughts????

[Greg H.]

HUD did not just let him go through with it. The purchaser signed 2 documents stating that they would be an owner occupant for at least 12 months. The agent signed the document as well. I would check back in a couple of months to see who is occupying the property as the evidence you have at this point is just hearsay.