HUD Homes FAQ – For RealtorsJen Sanders Team

Q. Can we see the listing before it comes on the market?

A. No. The only exception to this is if the property is in the Good Neighbor Next Door program, but this is rare in our area.

Q. Do you know how many bids have been submitted on a property, and how much they bid?

A. No. The bids are sealed, and we are unable to see the number of bids or the bid price.

Q. Am I able to see the appraisal?

A. No. HUD used to release that information, but it has recently changed. We do not have access to the appraisals anymore.

Q. What do the initials “IN, IE, or UI” mean?

A. IN or IE mean that the repair escrow amount is $5,000 or less and INSURABLE for an FHA loan.

UI means that the repair escrow amount exceeds $5,000 and is uninsurable with an FHA loan.

Q. Who can bid?

A. Owner-occupants only for the first 15 days on IN and IE properties

Owner-occupants only for the first 5 days on UI THEN a lottery period follows. Anyone can bid.

Q. How does the bidding period work?

A. 10-day bidding period first, then bids are countered, declined, or accepted. After the 10-day bidding period, daily bidding occurs.

Q. Will HUD pay closing costs?

A. HUD will pay up to 3% of closing costs, but remember, this counts against the net sales price.

Q. Who chooses the closing company?

A. The buyer chooses the closing company.

Q. Will HUD pay title insurance if the buyer uses HUD’s closing company?

A. No. HUD used to offer this, but they no longer pay for title insurance if the buyer uses a certain company.

Q. Can the repair escrow be increased or decreased?

A. Yes, the repair escrow can be increased or decreased per request by the lender.

Q. What about utilities? How do I get those turned on?

A. It is the buyer’s responsibility to get the utilities turned on for inspections and/or appraisal. You MUST get written permission from the Field Service Manager (contact information found on

Q. How long must an owner-occupant occupy the home?

A. 12 months.

Q. The property says it is being sold AS-IS on MLS. What does that mean?

A. All HUD properties are sold AS-IS, no exceptions, no repairs, and no credits for repairs.

Q. Can I make repairs, modify the property, or occupy the property before closing?

A. No. The property cannot be modified, repaired, or occupied before closing, or the contract may be cancelled and earnest money not returned to the buyer.

Q. Will you bring the keys to closing?

A. No. The buyer will not get the keys at closing. The selling realtor can access the home post-closing by the keys in the KB, but the locks must be changed as soon as the buyer has possession of the property. Please return the keys to the KB and leave it outside for my team to pick up.

Q. Will the title process take longer on a HUD-owned home than would a normal seller-owned home?

A. It can sometimes take longer on a HUD owned home, and is more likely to occur with financing.

Q. How much earnest money is required by HUD?

A. Earnest money must be certified funds. The guidelines are: $500 for a list price less than $50,000 and $1,000 for a list price $50,000 and up. The earnest money is held by the buyer’s selected closing agent, but it is delivered to the listing agent first.

Remember: Always use blue ink for signatures.

Tips for contract:

Use HUD’s contract

The closing company will know about the title before we know about the title

MUST have pre-approval or proof of funds dated within 30 days of accepted contract

Reminder for Jen’s properties:

Send EM to:

Jennifer Southard

Keller Williams Realty Advantage (Midtown Office)

2651 E 21ST Street, Ste. 100

Tulsa, OK 74114