Does HUD sell HUD Real Estate Owned (REO) properties in bulk?

A Bulk Sale is a direct sale of five or more HUD Real Estate Owned (REO) Properties to eligible buyers.
 
If HUD seeks to dispose of Properties through bulk sales, it will advertise and sell these Properties on an all-cash, as-is basis, without warranty and without FHA-insured mortgage financing.
 
To be eligible for bulk sale discounts, the Governmental Entity or HUD-approved Nonprofit purchasing in bulk must close on all property sale transactions no later than 60 Days from the date the contract is ratified.
 
If a Property is marketed and remains unsold for 60 Days, HUD may elect to sell the Property to eligible Governmental Entities and HUD-approved Nonprofits as part of a bulk sale as follows:
  • properties with an appraised value greater than $100,000 will be priced at a 10 percent discount from the appraised value;
  • properties with an appraised value less than or equal to $100,000 will be priced at a 50 percent discount;
  • properties with an appraised value less than $20,000, and considered “demolition properties” will be priced at $100;
  • participants purchasing 50 or more Properties will receive an additional 5 percent discount; and
  • under certain conditions, local governments may purchase Properties that have been listed for 180 Days or more, for $1, plus closing costs.  
For additional information please contact the Asset Manager with jurisdiction over the property. To locate contact information for the Asset Manager please visit the HUD Homestore website at http://www.hudhomestore.com/ and click “Help” in the gray tool bar.
 
For policy information see Handbook 4000.1 Section IV.B.2.f.vii. at https://www.hud.gov/program_offices/administration/hudclips/handbooks/hsgh

All policy information contained in this knowledge base article is based upon the referenced HUD policy document. Any lending or insuring decisions should adhere to the specific information contained in that underlying policy document.


Topic Number: KA-03674