HUD Home: 35k price, 125k ARV, but one hitch...

[Mark B]

Hi guys,

I'm new to HUD so this may be a bit basic. I found a great rehab opportunity that I want to pursue. The house is a HUD home 3/2 for 35 k. It has been listed for about 5 days. The houses on the block range between 98k and 137k. It needs some work, but just cosmetic (I'll admit I haven't had a showing yet).

My realtor tells me that it is not available to investors until 2/26. Only available to home-owner occupant now. If this lasts till 2/26, how will the seller decide which offer to go with if several investors all submit on 2/26?

Will they go with the first offer? Or could this potentially turn into a bidding war of sorts? Is it possible to submit the offer a day in advance back dated to be the first in line? What other advice can you give me?

Thanks,
Mark

[Owen Dashner]

In my area, HUD reviews bids every 24 hours (during the work week) and selects the bid with the highest net to HUD (total amount going to HUD after commissions, fees, etc.) if there are multiple bids, and assuming that the highest bid meets HUD's minimum acceptable threshold. They will also give preference to owner-occupant bids over investor bids if they are apples to apples.

They will not necessarily go with the first offer.

Yes, it could turn into a bidding war if it is a great deal.

No, you cannot submit your offer a day in advance back-dated.

If the house meets your numbers, make your offer that supports your numbers. If you get outbid, move on to the next one.

By the way, I can almost guarantee you that the house needs more that cosmetic fixes at that asking price and ARV. You don't see many paint 'n carpet jobs on $35K houses with that high of an ARV...

Just my $.02.