HUD Homes FAQs

What is a HUD Home? The United States Department of Housing and Urban Development (HUD) oversees the Federal Housing Administration (FHA), which provides federal insurance against defaults on home mortgages. If the payments are not made on a federally insured FHA loan, the mortgage holder seeks foreclosure or accepts a deed-to-lieu, then files an FHA insurance claim for the unpaid loan balance and conveys title to the property to HUD. Once this occurs, the house becomes a HUD owned home and put up for sale.

Who can buy a HUD Home? Any qualified purchaser can offer to buy a HUD home, regardless of race, color, religion, sex, national origin, handicap or familial status.

Who can assist me in purchasing a HUD Home (HUD registered real estate agent)? Jason Opland of Better Homes and Gardens Realty is a licensed HUD real estate agent authorized to show and submit HUD home offers on the buyers’ behalf in Ohio.

Where can I find HUD properties in Ohio? HUD properties can be found at under by clicking “foreclosure” under home type or you may email us a request and we can set up a custom search to notify you as soon as new HUD homes matching your search criteria hit the market.

Here’s your chance to be notified of new listings that meet your criteria, absolutely FREE! Note: Our home search form lets us create and save multiple Home Search profiles for you. You may ask us to update these profiles or cancel at anytime.

What is the Financing/Qualification Process? Before making an offer, prospective buyers must have their financing ready. If you choose to use a Mortgage lender, a “pre-qualification” letter must state a loan application has been made, a preliminary Credit Report has been performed, reviewed and approved. Furthermore, the letter must state that on the basis of the review, the mortgage financing for a specified dollar amount is sufficient to purchase the property. The letter must be dated and signed within 30 days or less prior of the bid date. If you choose to pay with “Cash” you must provide proof of available funds. A bank statement must be signed, stamped and dated by a bank officer. Teller signatures or teller receipts are not acceptable.

Will HUD pay my Closing Costs? The seller (HUD) will pay up to 3% of closing cost for the purchaser. The 3% amount is based on the bid price.

What are the Types of Financing for HUD Homes? FHA is often the best source for financing. Depending on the condition of the property, an FHA 203(b) loan or FHA 203(k) loan may be used.  A property may also be purchased for cash or with a conventional loan.

How much is the Earnest Money Requirement? Prior to submitting a bid on a HUD home, purchasers must secure a deposit (Earnest Money). A cashiers check or money order must be payable to “HUD” on the check.  If your offer is accepted, the deposit amount will be credited to the sales price at closing. If your offer is NOT accepted, the deposit is returned to you the next day. If the sales price is $50,000 or less, the Earnest Money Amount is $500.00.  If the sales price is $50,001 or more, the Earnest Money Amount is $1,000.00.

How does the Bidding/Offer Process Work? All offers on HUD homes are submitted electronically to HUD’s authorized Marketing Managers by a HUD authorized Realtor/Broker. The number of offers and amounts submitted are not disclosed to potential buyers.  Bid results are typically posted by noon the next business day after the bidding window has closed.

Does HUD offer a Home Warranty or Guarantee the Property? All HUD Homes are sold “AS-IS”. HUD does not make any repairs. There are no representations or warranties, express or implied, on the houses. HUD does not guarantee the condition of any house. Purchaser must make sure the home is in a condition they are willing to accept.  Purchasers may NOT make repairs to the home prior to closing and funding.

Where can I find out more information about HUD? The website for HUD (U.S. Housing and Urban Development) is an additional resource available to answer your HUD questions.  It can be accessed by clicking this link:

Have other HUD questions not listed here? Please contact Jason Opland of Better Homes and Gardens Realty, a HUD real estate agent authorized to show and submit offers on the buyers’ behalf in Ohio.  You can reach Jason at (614) 332-6984 or via email at