Presented byNicole James Real Estate Group

Part of our

Home Buying Orientation

Who are we ?

• Nicole James Real Estate Group is a full service real

estate firm serving Raleigh-Durham, all surrounding

areas of North Carolina and Atlanta Georgia

• Est in 2008, principal brokers – Tiffany Nicole & Gerald

James have sold over 1,000 homes;

• Tiffany - top 1% agent with the exclusive CLHMS

designation; public affairs background; Realtor since 2005

• Gerald - Army veteran, engineering background, & Duke

MBA - extensive experience in real estate & investments

• Developed a team of professional Realtors to best serve

clients in response to the changing real estate market

• Committed to service with an emphasis on

accountability, reliability, timeliness and enthusiasm

• We believe a successful real estate transaction relies

upon the strength of relationships & proficiency of

"getting things done"

• As your buyer’s agent, we will passionately work on

your behalf & provide the best guidance to help

you make the best real estate decisions

Why work with us ?

Strong Team

We are a team of

high-quality

professionals

Maximize Return

As an independent firm, we

can work with you closely

to maximize your return

Integrity

We have uncompromising

integrity & will represent

your best interests

Proven Success

A consistent top

performer

Latest Resources

We utilize the latest

real estate resources

REO, Bank Owned, Foreclosures

• REO – Real Estate Owned aka Bank Owned, different names for Foreclosures

• HUD Homes are a type of REO homes that are owned by the US Gov’t

• At one point were FHA Loans (backed by US Gov’t) that defaulted and were foreclosed by the lender

• The lender than transfer ownership of home to HUD (Dept of Housing & Urban Development)

• HUD place these homes on the market for sale through listing brokers

HUD Basics

• HUD homes can be single family homes, townhouses, condominiums, manufactured homes, or multiple family homes up to four units

• SOLD as-is, no representations or warranties

• Repairs can not be made before closing, no exceptions

Who Can Purchase a HUD Home• Any individual regardless of race, color, sex, religion, national origin,

handicap, or familial status

• Any legal company

• HUD approved nonprofit or Gov’t entity

Purchasing HUD Homes

• Only HUD registered brokers may submit electronic bids for HUD owned properties on behalf of buyers

• All bids are placed at http://www.HUDhomestore.com

• Great opportunity to purchase a home at a discounted price• Almost always HUD properties need repairs and/or updating

• List price on HUD properties are based on an appraisal• However buyers can bid whatever amount they think house is worth

• Unlike online sites, there are no displayed current highest bid

Purchasing HUD Homes

• HUD properties has bidding periods• Availability is subject to the HUD/Asset Manager accepting bids or removal

• Lottery Period – first bidding period available when a property is listed on HUDhomestore.com; only applicable to non-profits & GNND participants

• Exclusive Bidding Period• First bidding deadline for 10-days; no bids are viewed until day 11

• Goes to a daily deadline after day 11 if no acceptable bids

• Only owner occupants can submit bids during the Exclusive Period

• Investors can NOT submit a bid during the Exclusive Period

• Extended Period• Bidding period after exclusive if no acceptable bids – 14 to 30 days

• All bidders including Investors can bid during the Extended Period

Purchasing HUD Homes

• Information needed for Bids• Full legal name

• Mailing address

• Email and contact number

• Bid amount – purchase price & requested closing cost up to 3%

• Bid type (cash, FHA, conventional)

• SSN, EIN, or TIN

• Earnest Money Deposit (EMD)• $500 if purchase price is $50,000 and less

• $1,000 if purchase price is $50,001 - $250,000

• $2,000 if purchase price is $250,001 and more

• Certified check or money order only (no personal checks)

Types of Bidders

• Owner Occupant• Purchase with the intent to live in the property as their primary residence for

at least 12 months

• Cannot have purchased another HUD property as an owner occupant in the previous 24 months

• Misrepresentation is a serious offense that may constitute fraud & an investigation by the Office of Inspector General. Investigations not only will focus on buyers, but also on brokers & agents representing the buyer

• Falsifying information regarding purchaser type is punishable by a fine not to exceed $250,000 and/or prison sentence of not more than two years

• Investor• Buyers who are purchasing a property as a second/vacation home as well as

buyers purchasing the property for reasons other than owner occupancy

Types of Bidders

• Good Neighbor Next Door (GNND)• In certain areas (revitalization areas), HUD homes are offered during lottery

period at a 50% discount▪ Not all properties in the lottery period are GNND eligible; must state GNND

• Requires a second mortgage with no interest payments▪ Must fulfill the three year occupancy requirement as their sole residence

▪ Certify eligibility every year

• Neither GNND candidates nor spouses can have owned any real property in the previous calendar year

• Full-time Teachers, Law Enforcement Officers, Firefighters, or EMT▪ Teachers must serve students from the area where the home is located

▪ Officers employed full time by a law enforcement agency (federal, state, local gov’t)

▪ Firefighter/EMT employed full time by a fire depart or emergency medical services (federal, state, local gov’t) serving the area where the home is located

Financing Options

• Cash, Conventional Financing or FHA to purchase HUD homes

• FHA (Federal Housing Administration) Loans• FHA loans are for owner occupants only - $100 Down Program

• Depending repairs – FHA 203B, FHA 203B with repair escrow, FHA 203K

• FHA 203B w/repair escrow• Money held in escrow for repairs to meet the minimum property standards

• Plumbing, Electric, Heating - Cosmetic Repairs are NOT considered

• Repairs must be made within 90 days after closing in order to be reimbursed

• FHA 203k• Type of FHA loan where you can finance renovation cost into the loan

• Typically repairs needed more than repair escrow allows ($5,000 / $10,000)

• Requires getting work estimate from licensed contractor

HUD’s “AS-IS” Policy

• All HUD homes are sold strictly “AS-IS”

• HUD does not make repairs on any property

• There are no representations or warranties, expressed or implied; no guarantees of condition, regardless of its FHA insurability

• The property may or may not meet local code or zoning requirements. It is the buyer’s responsibility to investigate compliance with local regulations

• A Property Condition Report (PCR) should be reviewed• Information purposes only; not a warranty of any kind

• Buyer’s responsibility to verify the accuracy of its content

• Strongly encouraged to have a home inspection

Home Inspection Policy

• Buyers are allowed a 15-day inspection period upon ratification

• Buyers must get authorization to activate utilities

• NO UTILITIES ARE TO BE ACTIVATED WITHOUT PERMISSION

• Utilities activation and expenses are the buyer’s responsibility

• Refer to the EMD Forfeiture policy should a buyer be dissatisfied with home inspection results

• All inspections & fees are at the cost of the buyers & will not be refunded should the buyers are dissatisfied with home inspection

Earnest Money Deposit Forfeiture Policy

• Investors• Forfeit 100% of EMD for failure to close regardless of reason

• Owner Occupants• Refund of EMD for the following circumstances:

• Death, serious illness or significant medical expenses in immediate family

• Loss of job by one of the primary breadwinners or substantial loss of income through no fault of the purchaser

• Other good cause as determined by the HUD / Asset Manager (AM)

• Forfeit 100% of EMD for the following circumstances:

• No documentation is submitted

• The documentation received fails to provide an acceptable reason for buyer’s failure to close

• The documentation is not provided within a reasonable time following cancellation

Extension Policy

• If closing does not occur on or before the specified date, an extension request has to be made at least 5 days prior to deadline

• Supporting documentation such as a lender letter is required

• Each extension, if approved, are for a period of 15 days

• An extension fee is required with each request – up to $375

• For owner occupants, the initial 15-day extension fee is waived

• Extension fees are non-refundable, however if closing occurs in less the 15 day period, the unused portion will be credited to the buyer

• Approval of an extension does not obligate HUD /AM to approve future extensions

contact@nicolejames.com