HUD home buying timeline

There are four possible stages that a HUD home may go through:  Pre-listing, Initial Listing, Subsequent Listing and Closing.  The following section outlines the major points and events that transpire during these stages.

Pre-Listing Period

When HUD has just acquired title to the foreclosed home, the property must be cleaned, appraised and readied for sale.  During this time, HUD clears out any remaining trash and rubbish left in the home by the previous owner.  Also, HUD will send out an FHA approved appraiser to determine the current market value of the home and if the home meets FHA insurance guidelines.  Final preparation is made to list the home on the market and begin the next stage of the timeline.

Initial Listing Period

The initial listing period for a HUD home, which is generally the first public listing, is 45 days.  During this time, priority is given to owner-occupants who are buying the home as their primary residence.   

All owner occupant offers received during the first five days of this initial period are considered to be received simultaneously.  On the first business day after the bid deadline, these bids are reviewed to determine the highest acceptable offer to HUD.

If there are no acceptable bids, any new bids are reviewed on a daily basis for a maximum of five days.  Bids received received at different times during the day will be considered received simultaneously, and the highest acceptable net bid will be acknowledged on the date opened.  If the property remains unsold after tend days, it is made available to investors as well.

Subsequent Listing Period

After the initial 45-day listing period, the subsequent listing period begins and runs for 90 days.  During this time, properties are available to owner-occupants and investors.  Bids are reviewed on a daily basis (which are considered to be received simultaneously throughout the day).  Price reductions may be made during this period.  If the property remains unsold, it will continue to be listed.

Closing

A buyer is generally allowed 45 to 60 days to close on a HUD home at the pre-determined closing agent.  Once the buyer is ready to close, the real estate agent and title officer will schedule a closing date for the buyer to sign the closing documents.  

If the buyer needs to extend the closing date, HUD may grant an extension in 15 day increments.  An extension fee may be charged by HUD and must be submitted in writing.