What Is The Difference Between A Hud Home And Reo?
What Is The Difference Between A HUD Home And REO
?
There many homes in foreclosure on the Tucson housing market today. However, sometimes it can be difficult to understand the difference between the types of home on the market. Before you can make a bid, you have to understand the differenceotherwise you may not know what you are getting yourself into. What is the difference between Tucson HUD homes and REO properties?
How they are similar
Both Tucson HUD homes and REO properties are the result of foreclosures. Both of these properties can be listed on Internet sites and the Multiple Listing Service (MLS). When buying Tucson HUD homes and REO properties, it is important to know that financing is not provided. This means that a prospective buyer has to find a mortgage lender or have the cash available to purchase one of these homes. Both Tucson HUD homes and REO properties are sold "as is." The value is based on a recent appraisal. There are never face-to-face negotiations with either; a real estate agent representing either the HUD or bank always makes the buying offer.
How they are different HUD homes
If you are interested in purchasing one of the Tucson HUD homes, you have to go through an agency under contract with HUD. Though these properties may be MLS listed, they can only be handled by a HUD registered real estate broker.
Tucson HUD homes have an "offer period" during which they are offered to primary owners first. This means that the person buying one of these HUD properties actually wants to live in the home and not flip the home or rent it out. If there is no qualified buyer to be found, investors are allowed to bid on the Tucson HUD homes the property then goes to the highest bidder. If you purchase one of the Tucson HUD homes, you are not allowed to buy another HUD home for two years.
How they are different REO
REO properties are commonly handled by a bank's loss mitigation department. This department does not necessarily worry about selling properties, their main function is to minimize the loss on defaulted loans. Unlike the Tucson HUD homes, it can be quite difficult to establish who is allowed to decide whether or not the bank-owned REO property is to be sold. This is because every bank has its own requirements and rules when it comes to selling bank-owned REO properties.