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The HUD Process!



A great source of affordable housing and investment opportunities are HUD Owned Properties. But, when it comes to HUD properties, did you know most Agents ARE NOT able to assist you! Only Authorized and Certified HUD Brokers like Dan at THE BOONE CREW can open the doors to these homes for you! To search for available area HUD homes, click on the links below. You can search every county in North Carolina and South Carolina for available properties. AND! If you find a property of interest...

AT 828-726-9180


Then Click On - Search Properties for sale by City

                 CALL THE BOONE CREW AT 828-726-9180

                   Image result for images for check marks     $100 DOWN PAYMENT PROGRAM
                   Image result for images for check marks      GOOD NEIGHBOR NEXT DOOR
                   Image result for images for check marks    3% CLOSING COST ASSISTANCE
                   Image result for images for check marks     FOUNDATION CERTIFICATION
                             FOR COMPLETE DETAILS...

WHAT IS A HUD HOME? A HUD home is a home sold utilizing a FHA guaranteed loan where the owner defaulted, was taken back by the bank and then sold/deeded by the bank to The Department of Housing and Urban Development or HUD for disposition. HUD Utilizes the services of Management and Marketing companies (M&Ms) to manage the process and sell the homes on their behalf.

HOW MANY HUD HOMES ARE THERE AND HOW DO I FIND THEM?                          With the current rash of mortgage defaults, there are more HUD homes on the market now than at any time since the mid 90's. To find a HUD home near you, click on CURRENT HUD LISTINGS!
You can search every county in North Carolina for available properties. AND!  If you find a property of interest... CALL DAN TODAY AT 828-850-0138!

WHAT ARE THE MAIN PROS & CONS TO BUYING A HUD HOME? The major PRO  is pricing. It is very expensive for HUD to keep a home in its inventory. As such, they price them to sell relatively quick and act quickly to reduce the price to get it out of inventory. Most HUD homes in our area sell within the first 45 days of being listed. If it has not sold within this time frame, HUD is aggressive in their bid acceptance to insure it is sold. The biggest CON  is that they are sold "AS IS"!  BUT!  HUD gives you every opportunity to have inspections performed on the home.


Purchasers are advised that the properties may contain code and/or zoning violations. HUD's contract requires its M&M contractors to identify any and all known defects, code and/or zoning violations in the Property Condition Report. BUT! There may be oversights. As such, HUD strongly recommends all buyers perform inspections of all of the homes systems. ONCE YOU OWN IT, YOU OWN ANY PROPERTY ISSUES AS WELL!


HOW DO I KNOW IF THERE IS AN ISSUE WITH ONE OF THE HOME'S SYSTEM?   HUD and its M&M's DO NOT  make any guaranties and/or warranties concerning any HUD property. No repairs will be performed by HUD after closing. HUD's M&M will ensure that prior to execution of a sales contract, all available property condition information will be disclosed in the HUD Property Condition Report and HUD Property Environmental Compliance Record. Purchasers are encouraged to have the properties inspected by a qualified home inspection service company to satisfy themselves as to the condition of the property. Purchasers have 15 calendar days from the date of the Purchaser's signature on the sales contract to conduct, at the purchaser's expense, any inspections, tests or risk assessments desired by the Purchaser. NOTE! When we are in the "Winterized Period". You will need to pay HUD a fee at the time of the offer to cover the cost of re-winterizing the home after inspections. This is not an option for any purchaser seeking FHA financing. All lenders will require a systems check which will require the water be activated.

HOW CAN I VIEW A HUD HOME & WILL HUD ASSIST WITH CLOSING COSTS?      You must contact a HUD CERTIFIED AND AUTHORIZED Selling Broker such as THE BOONE CREW  to visit listed homes and/or to make an offer. HUD will pay selective closing costs up to 3% of the purchase price, If the closing costs are included in the bid and inserted on the appropriate line of the sales contract. AND!  If you find a property of interest... CALL THE BOONE CREW TODAY AT 828-726-9180! We can walk you through the process and explain which closing costs are allowable and the maximum amount allowed by HUD in North Carolina. You may also obtain a copy of HUD's "buyer's kit" on the Internet at www.hud.gov

WHAT DOES IT MEAN ON THE CONTRACT WHEN IT SAYS                                      INSURED - UNINSURED OR INSURED WITH ESCROW?......... Listing Codes:

IN - Insured:
All properties listed as "INSURED" are eligible for FHA financing. These properties are eligible for insurance under Section 203(b) of the National Housing Act. An interest rate will be charged on the loan and is negotiable between the purchaser and lender. The mortgage may include some mortgage insurance payments. The originating lender is responsible for making final determination whether a property meets Minimum Property Standards and, consequently, is eligible for FHA insurance.

IE - Insured with Escrow Repairs:
Properties listed as "Insurable with Repair Escrow" are eligible for an FHA 203(b) insured loan. The lender making the new FHA 203(b) loan establishes an escrow for the amount of the repairs which includes a 10% contingency, not to exceed $5,500. The identified repairs are required to meet FHA's "minimum property standard" (MPS) and the total repair costs should not exceed $5,000. If a 203(b) FHA insured loan is used for financing, the repair escrow must be used for the needed work specified in the listing.


Normally, repairs must be accomplished within 90 days of closing and be monitored by an FHA lender. But, some lenders only give you 10 days from closing to complete the repairs. Ask your lender upfront so there are no surprises after closing! The lender will inspect work as it is completed on the house and distribute the repair monies as appropriate within ninety (90) days of closing. The costs of repairs are included in the loan amount and repaid by the borrower as part of the monthly payment. Any funds in the escrow account not used for the repairs will be applied to reduce the unpaid principal balance of the loan. The escrow does not apply if the buyer is not utilizing FHA loan financing.

UI - Uninsured:
Properties listed as "UNINSURED" means that certain repairs and or improvements are required to be eligible for an FHA 203(k) mortgage. The required repairs on most of these properties exceeds the $5000.00 limit for a FHA 203(b)loan. Purchasers of these properties have the option to purchase "as-is" with cash or conventional financing. These properties may also be eligible for a FHA 203(k) mortgage if the required repairs and or the improvements are completed in accordance with FHA guidelines. Ask a FHA lender for more details.

HUD's M&Ms are required to prepare a HUD Property Condition Report for each property. Prior to completing a property appraisal, the M&M will prepare and provide to the appraiser a comprehensive property condition report that provides potential purchasers with any information known to HUD that may affect the habitability, functionality or value of the property, including but not limited to: the functionality of all heating, cooling, plumbing, gas and electrical systems and appliances; outstanding code violations, pending litigation, demolition orders, other legal actions that may impact the property or violations of Homeowner's Association covenants that are known to HUD and that will not be resolved prior to closing; condition of the septic system or well; existing transferable warranties; copies of Homeowner's Association documents; the Environmental Compliance Record, the lead based paint disclosure, and the mold disclosure. The completed HUD Property Condition Report will be posted in the property file and will be made available to prospective purchasers on-line through the Internet Property Listing.

New listings are now available daily. During the Initial listing period (The first 15 calendar days), bids may be submitted by Owner Occupants only on insured and insured with escrow homes. On uninsured homes, there is a 5 day exclusive owner occupant period. Then on the 6th day it opens to all bidders.

Owner Occupant Priority Period.
For Insurable and Insurable With Escrow properties, bids shall be opened and reviewed on the eleventh (11th) day of the Exclusive Listing Period. All bids will be treated as having been received simultaneously. If no winning bid is received by the tenth (10th) day, bids shall be opened and reviewed on each day after the tenth (10th) day up to the fifteenth (15th) day, or until a winning bid is received. If no winning bid is received in that fifteen (15) day period, on the sixteenth (16th) day the listing shall be extended to all buyers. See Extended Listing Period below.

For Un-insurable properties, owner occupant bids shall be opened on the sixth (6th). All bids will be treated as having been received simultaneously. If no acceptable Owner Occupant net bid is received, the listing shall be extended to all buyers. See Extended Listing Period below.

Extended Listing Period.
At the conclusion of the Exclusive Listing Period, should a property remain unsold, all general public bids (including Investors) may be submitted daily.

General Public Bid Period:
At the conclusion of the 15-day Owner Occupant Exclusive Priority Period, (5th day for uninsured homes), if no acceptable bid has been offered, the process will be opened to all bidders on a daily review basis. These bids are reviewed each day and the highest acceptable net bid to HUD will be selected. In the event the property remains unsold after that days bid openings, daily bids received by 11:59 p.m. will be reviewed and results will be posted the next day at 1:00 p.m.

Bids received on the same day shall be considered to have been received simultaneously.

Friday, Saturday and Sunday bids will be reviewed as having been received simultaneously on Monday and the results posted by 1:00 p.m. and if there is an acceptable net bid, HUD will select it. Again, if there is no acceptable bid, the process will continue until there is. After apx 45 days, HUD usually reduces the asking bid price on the home by 10%.

Bids can only be submitted by an AUTHORIZED AND CERTIFIED HUD SELLING BROKERS  and their Agents and Brokers must submit bids through Internet bidding on HUD's web site (www.HUDHomeStore.com). NOTE: HUD reserves the right to waive any irregularity in any bid, reject any and all offers, and to withdraw a property at anytime.

Sales Contract Submission:
AUTHORIZED AND CERTIFIED HUD BROKERS  are required to review bid announcements to verify if their offer was the selected offer. The Selling Brokers must submit the original HUD Sales Contract along with all necessary addenda within 48 hours after the announcements are posted. To be acceptable, hard copies must contain no errors and all signatures and initials must be in blue ink.

REMINDER: AUTHORIZED AND CERTIFIED HUD BROKERS  must check the web site on a daily basis for available properties and bid announcements. If your bid is selected, a completed contract (with the required Addenda) must be in HUD's M&M office within the next 48 hours of Bid Result Publication or it will be considered canceled and the second highest acceptable net bid to HUD will be selected.

Multiple Bids by same purchaser on same property:
If multiple bids are submitted on the same property on behalf of the same purchaser, only the bid producing the highest net return to HUD will be considered.

HUD allows an owner-occupant to purchase only one property. If a prospective owner-occupant purchaser submits bids on more than one property, the bid will be considered in the following sequence:

If the prospective owner-occupant purchaser's bid is the only acceptable bid on one of the properties, then that bid will be the only one considered. If not, the bid that produces the greatest net return to HUD will be considered and all other bids submitted by that prospective purchaser will be eliminated from consideration. NOTE: Owner Occupants who purchase a HUD home through the bid process must wait 2 years before they are eligible to bid on another HUD property as an Owner Occupant.

Required Contract Documents:
If your bid is selected, a completed contract (with the required Addenda) must be in our office within the next 48 hours of Bid Results Publication or it will be considered canceled and the second highest acceptable net bid to HUD will be selected. To ensure that you submit an acceptable Sales Contract, please take a moment and ensure that the following are correct: Where Real Estate Agent signatures and/or initials are required, only the broker signs the contract and initials other documents. The purchaser must sign the radon, gas and mold form and lead-based paint addendum. It is MANDATORY that the earnest money be a cashier's check or money order ONLY - no personal checks. Line 9 of the Sales Contract must reflect 45 days. The "other addendum" box on line 11 of the Sales Contract must be checked. All purchasers must initial line 12 of the Sales Contract Line 6b of the Sales Contract MUST BE left blank.
In addition to the sale contract, the Broker must attach the following Addenda:

Lead Paint Addendum, if the property was built prior to 1978.

Notice to Purchasers Addendum when the offered amount exceeds the appraised value at the time the offer is submitted.

Certification of Owner-Occupant, if purchaser is an owner-occupant. HUD Form 9548C General Addendum to Sales Contract.
Letter from a Financial Institution acknowledging that purchaser has funds available for down payment.

Mortgage Pre-qualification Letter from a lending institution, if the purchase is to be mortgaged, stating that an in-house credit check has been performed and the purchaser has been pre-qualified for a mortgage up to a specified mortgage amount.
Certification from a Financial Institution, if the purchase is cash, stating that funds are available on the day of closing.

Radon Gas and Mold Notice and Release Agreement, FOR YOUR PROTECTION GET A HOME INSPECTION. AGAIN!  If you find a property of interest... CALL THE BOONE CREW TODAY AT 828-726-9180 and we can walk you through the process and answer any and all questions!

Certification of Owner-Occupant Status:
All bids by owner-occupants, who are purchasing properties listed in the owner-occupant category, must include an Owner-Occupant Certification. Sanctions will be immediately imposed upon Brokers, Agents and Investors found to be abusing the system which include forfeiture of earnest funds, fines and/or imprisonment. Brokers will also be de-certified and could lose their license to sell real estate.

Flood Insurance:
Flood Insurance Notification - The purchaser shall provide the Closing Agent proof of flood insurance as a condition of closing for all improved properties located in a special flood hazard area where flood insurance is available through the National Flood Hazard Insurance Program, even if it is not required by the Purchaser's lender, if any. This requirement does not apply to vacant lots, properties sold to ACA partners that are scheduled for demolition or properties sold without any type of Federal Assistance including, but not limited to discounts, Purchase Money Mortgage's sales incentives and closing cost assistance.

Electronic Bid Withdrawal:
You may withdraw an electronic bid by downloading HUD's electronic Cancellation Form, completing the form and sending via e-mail or fax to the M&M's regional office, no later than 10:00 a.m. on bid opening day. The message must include:

Broker's Name
Tax ID Number or SSN
Agent's name and telephone number
Reason for cancellation
Key information concerning the bid:
Case Number
Bid Confirmation Number

Counteroffer/Backup Offer:
Properties that are listed during the Exclusive and Extended Listing Periods may be eligible for counter offers. If after fifteen (15) calendar days of the Initial Listing Period HUD has not received an acceptable offer, HUD may extend a counteroffer if the original offer meets certain criteria approved by HUD. HUD will notify the selling agent or broker in writing of the predetermined net price that would be acceptable.

HUD will post the counteroffer and the period for resubmitting bids on the website. Brokers will be required to resubmit a second bid online that meets or exceeds the requirement. HUD will review all counter offers in conjunction with the competitive bids submitted prior to the bid deadline. HUD will accept the bid producing the highest acceptable net to HUD and post the acceptable offer in the bid results.

Down payment: Owner Occupants Only:
3.5% Minimum Down payment for FHA financed properties.
Maximum mortgage amount 96.5% of the appraised value
or sales price whichever is lower. currently, HUD is
offering Owner Occupants a $100 Down program. Call
The Boone Crew today for details!

1 unit: 25% Minimum Down payment, for FHA financed properties;
2 to 4 units: 15% Minimum Down payment, for FHA financed properties.

Required Earnest Money:
Brokers in NC must forward the earnest funds to HUD's designated closing agent along with the contract package. Earnest money deposits must be provided in one the following methods: Cashiers Check, Official Bank Check or Money Order only with no termination date or cancellation provision. In North Carolina, earnest money should be made payable to HUD.

Required Earnest Money Amount:
$1,000 for offers greater than $50,000; (not to exceed $2000)
$500 for offers $49,999 or less,
50% of the Listing Price for Vacant Lots

Earnest Money Forfeiture and/or Return:
The following provisions are applicable in all instances except those where HUD is unable or unwilling to close the sale, in which case the entire amount will be returned.

Investor Purchasers:

Uninsured Sales: 100% of the deposit will be forfeited to HUD for failure to close, regardless of the reason.
Insured Sales:

50% of the deposit will be forfeited to HUD for failure to close if the purchaser is determined by HUD to be an unacceptable buyer.

100% of the deposit will be forfeited to HUD if the sale fails to close for any other reason.

Owner-occupant Purchasers:

Return 100% of the deposit when:

There has been a death in the immediate family (purchaser, spouse or children living in the same household).

There has been a recent serious illness in the immediate family that has resulted in significant medical expenses or substantial loss of income, thus adversely, affecting the purchaser's financial ability to close the sale.

There has been a loss of job by one of the primary breadwinners, or a substantial loss of income through no fault of the purchaser.

For an FHA insured sale, HUD (or a D.E. underwriter) determines that the purchaser is not an acceptable borrower.

For an uninsured sale, the purchaser was pre-approved for mortgage financing in an appropriate amount by a recognized lender and, despite good faith efforts, is unable to obtain mortgage financing. "Pre-approved" means a commitment has been obtained from a recognized mortgage lender for mortgage financing in a specified dollar amount sufficient to purchase the property.

There is other equally good cause, as determined by HUD's designated closing agent, in keeping with the spirit and intent of the above policy.

Return 50% of the deposit when:

For an uninsured sale, despite good faith efforts by the purchaser, there is an inability to obtain a mortgage loan from a recognized mortgage lender.

Forfeit 100% of the deposit when:

No documentation is submitted.

Documentation fails to provide an acceptable cause for the buyer's failure to close.

Documentation is not received by HUD's designated closing agent no later than close of business on the tenth (10th) day following cancellation of the contract.

Vacant Lot Sales:

The purchaser is considered to be an investor and instructions pertaining to investors will apply.

Appraisal Request:
HUD will provide, at no charge, one copy of the appraisal to the winning bidder for use in obtaining a mortgage loan. If, for any reason, the winning bidder's lender requires a new or updated appraisal report, the cost of that report will be the responsibility of the winning bidder. However, the lender for a winning bidder obtaining any type of FHA insured financing report except a 203(k) rehabilitation mortgage must use the Contractor provided FHA appraisal report unless the report is more than six (6) months old on the date the sales contract is executed.

Closing Costs:
For all contracts executed on or after October 12, 2006, HUD will pay up to (and may not  exceed) 3% of all closing costs considered to be reasonable and customary in the jurisdiction where the property is located. If the total closing costs reflected on the HUD-1 settlement statement are less than the amount indicated on the sales contract, HUD will reimburse only the actual costs charged and will not credit the purchaser with any difference either in cash or through a reduced purchase price. Within the three percent (3%) allowance, HUD will reimburse loan origination fees up to one percent of the mortgage. However, on an FHA 203(k) rehabilitation mortgage loan, HUD will reimburse one and a half percent (1.5%) of the mortgage. To receive the closing cost assistance, the amount must be entered on Line 5 of the HUD sales contract.

Closing Time Frame:
All purchasers must close on or before forty five (45) days of contract acceptance date for all bids submitted.

Closing Extension Policy:
Closing Extension Request: If the closing is not expected to occur on or before the specified time on line 9 of the HUD Sales Contract 9548, the Broker must forward a written extension request to HUD's closing agent prior to the expiration of the time specified on the sales contract. HUD's designated closing agent, as HUD's Representative, may grant an extension of closing time and, if approved, extensions will be granted for a period of fifteen (15) days:

Submit the "Request For Extension of Closing Date" (Extension Request form) and all the required supporting documents to HUD's Closing Agent prior to the expiration of the sales contract. Documentation submitted with the extension request must establish that a closing can reasonably be expected to occur within the extension period. The extension request must be accompanied by a cashier's check, money order or other certified funds in the appropriate amount and made payable to HUD.
The fee is based on the Contract Sales Price: Contract Sales Price equal to or less than $25,000 Extension fee is $10 per day ($150)
Contract Sales Price of $25,001 to $50,000 Extension fee is $15 per day ($225)
Contract Sales Price over $50,000 Extension fee is $25 per day ($375)

The initial 15-day extension will be provided for owner occupant purchasers, at no cost, if documentation is provided indicating that proper and timely loan application was made, that the delayed closing is not the fault of the purchaser and that mortgage approval is imminent. The extension fee will be retained by HUD. In the event that the purchaser closes prior to the end of the extension period, the unused, prorated portion of the extension fee will be credited to the amount due at closing. The approval of an extension does not obligate HUD's Representative to grant future extensions.



Q: How do I activate the utilities? Especially if I am a buyer or appraiser who needs to see systems working in order to obtain a loan?


Brokers will have to notify the Field Service Manager (FSM) that they are requesting utilities be turned on and follow their policies and procedures for utility activation. The contact information for the FSM is provided in the contract package that is issued to listing brokers once a contract has been accepted.

Q: What is the bid period?


Each listing on www.HUDHomeStore.com has a Bid Submission Deadline. It is located directly beneath the Case Number and Eligible Bidders on the Property Details page of each property. Please be advised that the Bid Submission deadline is Central Standard Time (CST). The Bid Submission Deadline will change as it progresses through the various Listing Periods.

Q: I don’t have a NAID #. How do I submit a bid?


You cannot submit an offer without an active NAID #. The purchaser(s) will need to contact a broker with an active NAID # to submit the bid. In most cases, the Listing Broker should be able to work out an arrangement with you. If not, a list of active NAID brokers is listed on www.HUDHomeStore.com under the Find a Broker section.

Q: What is the difference between an Owner Occupant purchaser and an Investor purchaser?


An Owner Occupant purchaser is a person who plans to live in the property as their primary residence for the first 12 months after the close of escrow and has not purchased another HUD Home as an Owner Occupant within the past 24 months.

An Investor purchaser is someone who buys the property as a second home or as an investment, or who does not qualify as an owner occupant.

Q: What is the Lottery Listing Period?


Certain property eligibilities allow Good Neighbor Next Door participants, HUD registered nonprofit organizations, and/or government entities to bid on the property prior to becoming available to Owner Occupant bids. These properties, which are usually located in HUD designated revitalization areas or are determined to be uninsurable, are available in the Lottery period for seven (7) days. If there are no winning bids when the Lottery period ends, these properties then enter the Exclusive Listing Period for 5 or 30 days, depending on the insurability of the property.

Q: What is the Extended Listing Period?


This is the listing period after the Exclusive Listing Period has ended. All bidders are eligible to place a bid in the Extended Listing Period.

Q: How can I modify and/or withdraw my electronic bid?


Please be advised that bids can only be modified and/or withdrawn prior to the expiration of the current bid submission deadline you submitted your offer under.

You may modify and/or withdraw your bid by logging in to your Bidder profile on www.HUDHomeStore.com and clicking on Bidder Functions. You will need to enter at least one of the following pieces of information to retrieve your offer information: Bid Confirmation Number, Property Case Number (aka FHA Case Number), Purchaser Last Name, or the Purchaser SSN/EIN.

Select the Bid Confirmation Link of the offer you wish to modify/withdraw. The next screen will show you the details of the bid. Click on the Withdraw Bid or Modify Bid button at the bottom of the screen.

Please be advised that if you modify your offer your bid confirmation number will change!

Q: I have an accepted offer but I would like to renegotiate the amounts of my bid. Is this Possible?


No, HUD will not renegotiate the amounts in your offer after bid acceptance. Purchasers have the option to cancel their bid acceptance and submit a revised offer if and when the property is relisted. However, please be advised that there may be back up offers in place. Should you cancel your offer, the property will be offered to any back up offer purchasers prior to relisting it on the HUD Homestore. There is also no guarantee that a property will be relisted at all.

Q: If the sale is canceled, will the EMD be refunded?


EMD refunds and forfeitures are reviewed on a case by case basis. Please review the HUD Forfeiture and Extension Policy for specific scenarios regarding EMD forfeitures/refunds.

Q: When can the buyer get a home inspection done?


The buyer has a 15 day period after contract ratification (execution) to activate utilities and complete the home inspection. All inspections, tests, and risk assessments are performed at the purchaser’s expense.

Q: What will be the turnaround time on payment once a property closes?


The closing agent (per their contract with HUD) has 30 days to send out commission checks.