Hud ratified sales contract?????

Question

Hi. Our bid was accepted on a HUD home on 8/11. We sent all of our paperwork in before the 48 hours. On Monday, my real estate agent received a fax back from HUD, saying that she did not fully fill out the front page (grrrrr!). She fixed all of the errors and over-nighted it on Tuesday, so they should have received it Wednesday (8/20). All she had to do was fill in an address and have her supervisor sign something. So that should be it, right? I'm wondering how long it will be, now, before we actually receive the sales contract back? Do they send it to my house, or do they send it to the Real Estate Agent's office? I guess I feel like it isn't my house until I actually get the sales contract back from HUD. I know we are lucky, since I heard that sometimes if your paperwork isn't correct, that they may put the house back up to be bid on. We should have heard something by now, if they weren't happy with the paperwork, right? The website still lists it as being accepted. I need to stop worrying........

Answer 1

HUD is a stickler for paperwork.  If you're not an investor, but intend to live in the house, they are much more forgiving in making corrections.  If the error was on the "front page", that would probably mean the contract page itself.  It would need to be re-done again (that page) including YOUR signatures and initials.  Gotta be in blue ink and they only accept originals, not photocopies or faxes or emails of that page.  Most other pages, they accept faxes to make corrections.  If they got it in on Wed, the 20th, your Realtor would get it back on Friday or Monday just depending upon how busy the HUD contractor was this week.

Also, do get a home inspection.  Those pages you got off their website (if like the ones in Texas) are not worth the ink of printing them.  To do an inspection, once you have the signed contract back from HUD, you need to do a form requesting permission to have the utilities and water turned on in your name and to have the inspection. Once that is signed and returned by HUD, THEN you may have your inspection.  You cannot badk out for just anything, but if there is a major problem (previously undisclosed) with the Roof, Foundation, Major Plumbing, or HVAC then you can back out and get your earnest money back.  Other things on the inspection report are just your "to do" list for after you move in.

Good luck!

Answer 2

Yeah, you need to stop worrying, though its a huge event in your life, its certainly understandable.  I've found that you really have to be good about the deadlines with HUD, but if you are prompt they are very reasonable.  You made the first deadline - getting the contract to them within 48 hours, and thats really the main one (I've seen bids immediately cancelled and re-listed if that one was missed by a day - hard to really blame them as it seems that they have a fair number of bids where they never get the paperwork).  

You seem to have made the Wednesday deadline as well, but I'd still call them (or have your agent) first thing Monday morning just to say "we overnighted the changes Tuesday, just wanted to check that you got them and everything is going ok".  Leave a message if you don't talk to the person directly (and call whoever sent you the form notifying you of the changes needed).  There are 2 reasons for the call, to make sure they got the changes and to hear from them that everything has moved on to be signed.  When your agent makes the call if they say they have gotten everything and are looking over it, you are in good shape.  Only one time has it ever gotten to this point and then had a problem with the signing, assuming the contract is exactly the same as the bid you entered (the one time was a really weird case - not something to worry about).

If for some reason they didn't get the changes or they were mislaid or something, you may have a problem (as its been 4 work days on Monday) but this is highly unlikely, and since its still under contract on the market you should be fine (but have your agent make that call Monday morning - if they didn't get the changes for whatever reason that could be the difference between a few more days to resend them or a cancelled contract).

So, everything seems fine, (the call is just in case but for it to take them a bit to review the contract is standard) you should be hearing from them soon.