HUD Homes and Flipping - Posted by

Posted by Nate(DC) on July 12, 2002 at 21:57:25:

Not all HUD properties are listed owner-occupant only. If a property has been on the market for a while HUD may open it up to investors.


HUD Homes and Flipping - Posted by

Posted by on July 12, 2002 at 21:04:43:

I have a question. I recently figured out that a couple of “flippers” are advertising HUD homes for sale. I assume they are inspecting the properties and then advertising them. I do not know if they have a contract on the properties or not. They always ask for cash.

My question is is this legal? Don’t HUD properties have to be owner occupied and owned for at least a year? Is this is a loophole in the system?

Re: HUD Homes and Flipping - Posted by JeffM

Posted by JeffM on July 13, 2002 at 11:10:53:

Is it possible that these people are advertising to find a buyer for a house that they have yet to buy? In other words, if the Joe Advertiser finds a HUD home, and puts it in the paper, looking for Bill Buyer, and Bill Buyer agrees to pay $75,000 for the home. Joe Advertiser then makes a HUD bid of $60,000, knowing that he has Bill Buyer in his back pocket. HUD informs you of your success/failure on your bid within 48 hours, so, as long as Bill Buyer gives you more than that to accept his bid, you can essentially do a “buy and flip”, without actually owning the property. I don’t know how legal it is to offer something for sale that you do not own. This is all my guess as to what may be going on here. It really doesn’t seem like a bad idea, when dealing with people who don’t know how to buy a HUD home.
BTW, I am giving a possible scenario, I AM NOT AN EXPERT>

John, is this legal???