HUD House Headache

What is the name of your state? Utah

Our son Jim is trying to buy a HUD house and things are going badly. First a brief History:

December 10, 2002 – Jim makes an offer of $58,000 on a home listed at $57,000.
December 13, 2002 – HUD posts bids, Jim is high bidder, other bids were received, one only about $100 below Jim’s. Jim’s real estate agent tells him the house is his; it is just a matter of getting the paper work in.
December 20, 2002 – My wife and I fund the mortgage (we are the lender) by providing a certified check for $58,000 to HUD’s title company.
December 22, 2002 – HUD relists the house without telling Jim’s realtor; later she is told his bid was “too high”.
December 24, 2002 – Jim through his realtor submits a new bid for the house, again at $58,000. At the same time he asks his realtor to submit a protest to HUD.
December 26, 2002 – HUD posts bids and Jim is not the high bidder, one bidder is about $2000 higher than Jim. A few days later HUD contacts Jim’s realtor and tells her his bid is accepted.

Fast forward to today, Jim has apparently gotten his bid accepted, and he did finally get a contract from HUD but the closing process seems endless. In the original advertisement there was an offer from HUD to give the buyer a $1500 bonus if closing occurred within 30 days of contract acceptance. HUD did not finally accept the contract until January 15, but it now looks like February 14 may come and go with out HUD being ready to close. Jim has scheduled 3 different closing dates, but all have passed without HUD being ready. This has been very painful for Jim (and us) and it is particularly galling because HUD’s title company has had our money to fund Jim’s loan since December. Jim’s realtor is trying, and seems equally frustrated. I don’t know that she is very experienced with HUD but she is working hard. Every time Jim or his realtor is asked for something from HUD they turn it around in a few minutes. Every time HUD has to do something it takes weeks and is usually done wrong.

My questions:

How can Jim be sure and get his $1500 bonus, if he has done everything he can and HUD is the cause of the delay what can he do? HUD specifically states that this bonus cannot be a part of the contract and it is not. We do still have a copy of HUD’s original advertisement, and the title company is showing the $1500 from HUD to Mat on the closing statement.

How can we best push this thing along and make it happen?

How can HUD do business this way? First rejecting the highest offer and then accepting the same offer only after someone bid over it? Perhaps Tony Soprano’s approach to working with HUD is best.

Any other advice on dealing with HUD?

[HomeGuru]

[quote]Originally posted by rhinchee
[b]What is the name of your state? Utah

Our son Jim is trying to buy a HUD house and things are going badly. First a brief History:

December 10, 2002 – Jim makes an offer of $58,000 on a home listed at $57,000.
December 13, 2002 – HUD posts bids, Jim is high bidder, other bids were received, one only about $100 below Jim’s. Jim’s real estate agent tells him the house is his; it is just a matter of getting the paper work in.
December 20, 2002 – My wife and I fund the mortgage (we are the lender) by providing a certified check for $58,000 to HUD’s title company.
December 22, 2002 – HUD relists the house without telling Jim’s realtor; later she is told his bid was “too high”.
December 24, 2002 – Jim through his realtor submits a new bid for the house, again at $58,000. At the same time he asks his realtor to submit a protest to HUD.
December 26, 2002 – HUD posts bids and Jim is not the high bidder, one bidder is about $2000 higher than Jim. A few days later HUD contacts Jim’s realtor and tells her his bid is accepted.

Fast forward to today, Jim has apparently gotten his bid accepted, and he did finally get a contract from HUD but the closing process seems endless. In the original advertisement there was an offer from HUD to give the buyer a $1500 bonus if closing occurred within 30 days of contract acceptance. HUD did not finally accept the contract until January 15, but it now looks like February 14 may come and go with out HUD being ready to close. Jim has scheduled 3 different closing dates, but all have passed without HUD being ready. This has been very painful for Jim (and us) and it is particularly galling because HUD’s title company has had our money to fund Jim’s loan since December. Jim’s realtor is trying, and seems equally frustrated. I don’t know that she is very experienced with HUD but she is working hard. Every time Jim or his realtor is asked for something from HUD they turn it around in a few minutes. Every time HUD has to do something it takes weeks and is usually done wrong.

My questions:

How can Jim be sure and get his $1500 bonus, if he has done everything he can and HUD is the cause of the delay what can he do? HUD specifically states that this bonus cannot be a part of the contract and it is not. We do still have a copy of HUD’s original advertisement, and the title company is showing the $1500 from HUD to Mat on the closing statement.

How can we best push this thing along and make it happen?

How can HUD do business this way?

**A: hey, remember, you are dealing with the government here.
*********

First rejecting the highest offer and then accepting the same offer only after someone bid over it?

**A: the entire process sounds very strange.
**********
Perhaps Tony Soprano’s approach to working with HUD is best.

**A: no, HUD has bigger guns.
********
Any other advice on dealing with HUD?

**A: are you dealing with the local HUD office? If so, contact the main office in DC.

[HUD-1]

A few thoughts: First, you are dealing with a contractor, not HUD directly. First Preston handles HUD sales in Utah. Second, get documentation regarding the delay. Show that you were ready and willing to close within the 30 days. Did you call the HUD closing attorney and schedule a closing? Did you receive something in writing calling off the closing due to their delay? If they are curing title defects, get it in writing. In the end, if the delay was on the part of HUD or First Preston, you should still get the bonus at closing. If you don't get the bonus and feel the delay is not your fault, call/write HUD at the Denver Homeownership Center. 800-543-9378. Please keep us posted on the outcome.

[HomeGuru]

HUD-1, good to see you're back.

Thanks for all the advice, as a result we did start to doccument things and made it clear to First Preston what we were doing and that we were preparing to fight if our son did not get the bonus.

At the very last minute we got a closeing date that was honored we we closed at 6 pm on the last day we could and still get the bonus. Jim got his check a few days later.

I remained pretty unimpressed with HUD and First Preston, it's a good thing they are the government or work for them, they probably couldn't keep their jobs otherwise.

[HomeGuru]

Thanks for the update.