Monday, April 4, 2011

Hello HUD, is anyone home?

Currently I have some buyers that have made an offer on a HUD repo located in northwest Boise. They are paying cash, using money from a self directed IRA. They would have been ready to close within a week from when we submitted the offer. HUD states for us to insert a 45 day closing timeframe in the offer. The management company for HUD has not yet paid all the bills so that the escrow company can close the transaction.

We are now 30 days into the escrow period and I receive a notice today that my buyers need to file an extension for the closing date and include an extension fee. It is the HUD vendor's fault for the delay and yet they have the gall to request an extension fee from my clients. The request letter does state that if the delay is not the fault of the buyers, the fee will be refunded at closing. So they will get it back, but it does really bug me.

While I am on the subject of HUD, we had another transaction a year or so ago with another cash buyer purchasing a HUD repo in Kuna. Our buyer was ready to close early and was informed that HUD would not close it before the stated closing date. Not that there was anything preventing it from closing early but that was when they had scheduled it.

Most sellers want their money as soon as they can get it. There is a certain amount of time value with money. But this is our government after all and as we often see they don't expend a great deal of rational thought on how to wisely spend our money.

So hello HUD, anyone home?

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