This is a disclosure, intended
to disclose some of the facts and conditions that may apply
to the process of purchasing a HUD Government Owned Home.
You should also review the HUD sales contract and all of
HUD's addendums prior to the purchase of a HUD Owned
and Brokers associated with Eagle, Realtors have signed
and agreed to abide by the terms and conditions of the
VAMA (Voluntary Affirmation Marketing Agreement), and
will abide by its rules and regulations. We abide by the
Fair Housing Act of 1968 as amended and will not discriminate
against or give preference to anyone on the basis of race,
color, religion, sex, handicap, familial status or national
origin. This law does not allow us to discuss any of the
above items with you. Please do not ask us to violate
the law, as we will not.
pays all of the commission on the sale directly to the
broker on all HUD Homes. Any Agent and or Broker that
is helping you in the purchase of a government home is
an agent of the Seller (The Government) unless you have
a separate agreement to represent you. See the Texas Real Estate Commission
(TREC) Agency Disclosure Form known as the
"Information about Brokerage Services Form" included
in the contract package. We will treat you fairly
and honestly in the transaction and assure that the transaction
is a Federal Government Agency and according to Federal
Attorneys is not required to comply with the State of
Texas Disclosure and furnish prospective purchasers with
a Seller's Disclosure. A Seller's Disclosure consists
of acknowledging defects, certain deaths on the property,
previous defects that have been repaired, previous termite
treatment, etc. this is normally required to be filled
out by the seller, and acknowledged by the buyer before
an offer is accepted. HUD doe not provide this disclosure
and are not required to by Texas law. In lieu of this
they recently started making a Property Condition Report
(PCR) available on most HUD homes sold in Texas.
This is not an inspection report prepared by a licensed
Real Estate Inspector but instead a report prepared by
a contractor working for HUD and their Management and
Marketing (M&M) Contractor. Although this is a fairly
thorough report you still have the availability to have
a separate inspection done by a licensed inspector of
not have any information that they will disclose to the
purchaser or Broker/Agent involved in the transaction
as to the previous owner or the reason why the home was
foreclosed upon. Typically the reason that a home is foreclosed
upon is because payments were not made on the home for
some reason, thus causing the foreclosure, or the home
was transferred to the Government in lieu of foreclosure.
We will supply you a copy of the tax records and other
information on the home.
The buyer is encouraged to have their own termite
inspection prior to closing at the purchaser's cost
(usually between $60-$100). If the buyer is using
FHA financing on a HUD home, HUD will provide a
current Wood Destroying insect report and treat the
home if necessary at no cost to the buyer. If
you are not using FHA financing or an FHA 203K Loan this would be at the
expense of the buyer.
that is being marketed by HUD may be located within the
100 year Flood Plain, as determined by FEMA (Federal Emergency
Management Agency). If purchasing a home that is in the
flood plain, your Mortgage Company will require that you
obtain Flood Insurance for the home. You should consult
your Insurance agent for a quote, if the home was built
prior to the 1970's it may qualify for a reduced insurance
rate. To get the best possible price on your flood insurance
an elevation certificate may be required, this would be
the buyer's expense, and could cost between $50 and $500.
If the home has previous flood damage, you may be required
to get permission to rebuild the home from the city or
county. If they do not grant permission the home has little
or no value.
of the land in the Houston area is flat and drainage is
very poor, if any area receives a large steady rain, the
area is likely to experience flooding. We have links on
our website to the
FEMA flood map store and we will be glad to print
you a copy of the most current map available but even
if the home is in or outside the flood plain this is no
assurance that the home will or will not flood in the
homes are sold by Sealed Electronic Bid, therefore, there
is NO possible way that we can accurately predict how
many bids there will be on any home or how much any home
will sell for. We will only be able to give you the current
list price of the property, the tax records that show
the previous assessed values of the property, and comparative
market values of similar homes in the area. If you request
it, we will give you, based on our expertise, our " Best
Guess" of what the home will sell for, but the final decision
is up to the purchaser. If more than one bid is submitted
on the same home through Eagle, Realtors, we are not at
liberty to discuss the other bid with you, nor can we
discuss your bid with them. Please do not ask us to discuss
these other bids with you, as we will not be permitted
to do so.
the bid results. We will only know if you won the bid
or not, usually by 11:00AM to Noon each business day.
We will call you as soon as we know if you are the
winner or not.
INSPECTIONS / REPAIRS
homes are sold "AS-IS WITH ALL FAULTS" with NO Repairs
of any kind except Termite Treatments or LBP abatement
in some specific circumstances.
The only exception to this is when the seller has designated
certain items to be repaired or replaced by by utilizing
the HUD FHA loan with an escrow repair program. This allows
the buyer to include the cost of these repairs in his
new FHA mortgage and do the repairs after closing.
If HUD determines that you have done or attempted to do
any repairs to the home before closing, your contract
will be canceled and your earnest money will be forfeited
to HUD with no exceptions no matter how small or how urgent
Once the contract
has been accepted and executed, after we receive written
permission from the FSM after paying a fee to have the
property re-winterized, HUD will allow you to have utilities turned
on for a 48-hour period to have inspections of any item
in the home performed. However, they will NOT repair items
in the home for you. HUD at their expense
performs a complete home inspection prior to
placing the home on the market. This is
available for your review before bidding on
a HUD owned home. You are still
encouraged to have an independent inspection
performed by an inspector of your choice.
your safety in your home YOU are encouraged to install
or have inspected the following items to assure your safety
in your home. Ground Fault Interrupters (GFI) Electrical
Outlets near any water source, such as bathrooms, kitchens,
laundry, garage, and outdoors. Install new High pressure
Relief Valves on all Hot Water Heaters. Have any furnaces
checked by a professional for cracked heat exchangers.
Double Wall (Safety) Flues on any gas furnaces or gas
water heaters. Carbon Monoxide testers on any gas homes.
You should also install NEW Smoke Detectors near each
bedroom and on each floor.
INTEREST RATES / LENDERS
Your interest rate
on your loan is subject to change up until the date of
closing unless you have a written agreement with the mortgage
company or bank. Neither the agent, broker or lender
has any control on the financial markets that control
the rates on your loan. Please discuss this with
your lender and receive information about locking in your
rate if you desire. It is dependent
on many factors and you should discuss this with your
Lender and or Loan officer. You may choose any lender
that you wish on the HUD properties, but please be aware
that most lenders do not participate in the HUD Sales
Program. Typically the interest rate on these HUD loans
is slightly above the normal market rates since the lender
is not allowed to require certain items such as appraisals,
surveys and other lender charges normally allowed. As
your "Buyer's Agent" we are allowed to make recommendations
to you as to contractors, inspectors, and lenders but
you as the buyer always have the ability to chose someone
that you wish to use do handle the other parts of your
you to obtain an Owners Title Policy on your home. We
can ask that HUD pays this expense for you, if requested
by your agent on the HUD-9548 Sales contract at the time
of submitting your bid. A list of these cost is available
on our web site at the resource
page. This insures you the buyer that there are no
outstanding liens on the property and that all-previous
tax and assessments have been paid. This policy will also
list any easements that are recorded against the property.
If you request an Owners Title Policy, the closing agent,
will be glad to furnish you with a copy of the Title Commitment
prior to closing if requested by you, if not requested
you will be supplied one at closing. YOU ARE ENCOURAGED
TO HAVE THIS TITLE COMMITMENT EXAMINED BY AN ATTORNEY
OF YOUR CHOICE. You can choose any title company to
issue the policy that you wish.
time that we process your bid on the home, we must be
in possession of your earnest money check. All checks
need to be certified funds, either a cashiers check or
money order. Your earnest money will be deposited with
the appropriate government agency upon you winning your
bid. If you do not win your bid we will return your check
immediately. HUD requires a $500 earnest Money for
bids below $50,000 and $1,000 if bidding above $50,000.
The check should be made payable to the "Title
Company That You Choose".
check with us for the most current amount required.
EARNEST MONEY REFUNDS
some reason, the transaction of purchasing the property
is not successfully completed, your earnest money may
be forfeited; however, it is the decision of the Government
agency that is selling the property as to whether or not
the earnest money would be refunded. As the broker in
the transaction we have no control of the disposition
of these funds. A specific addendum is used to explain
this process on the sale of the HUD homes.
requires that should you not be approved on your loan
we must send a copy of the rejection letter to HUD's Management
Office and get a release letter that can then be taken
to the HUD closing attorney to allow you to receive a
refund. HUD has a very specific policy regarding earnest
money dispositions, a copy of this is included in the
contract package, and we will cover it in more detail
does not supply, nor require that you purchase a survey
on the home. The government assumes that the home is in
the same location as when they made the original loan
on the home. In a normal loan transaction the lender requires
a survey to insure that the home is within the property
lines and that there are no encroachments that affect
the title to the home. In these transactions, if you use
the government sponsored financing, the Lender does not
require a survey; however, you are encouraged to order
a survey at your expense, through either the lender in
the case of a HUD home or through the Title Company. If
you use FHA 203 K financing, you will be required to get
a survey, at your expense. If you wish to have a survey
we must have sufficient notice as soon as possible in
order to insure that it is done prior to the closing.
DEED RESTRICTIONS, MAINTENANCE FEES & HOMEOWNERS
home may be located in a subdivision that has a mandatory
homeowners association, subject to an annual maintenance
fee. This property may be subject to Deed Restrictions
that limit the use of the home in certain ways. You should
contact the subdivision or Title Company to obtain a copy
of the deed restrictions prior to closing. It is strongly
recommended that you investigate the financial status
of the Homeowners Association, and determine if there
are any current or past violations that may affect the
property that you are purchasing
FROM OTHER SOURCES
We may have supplied
you with information that we have obtained from various
sources that we believe to be accurate. Some of these
sources are, but not limited to: County Clerk Records,
HUD Listing Data, HUD's Property Condition Reports, VA
Listing Data, PropertyInfo.com and a
Tax Data Base Service and a division of Stewart Title
Company, Houston Association
of Realtors MLS (Multiple Listing Service Data Base),
flood maps from FEMA and other agencies, hazardous material
information from EPA, and other sources on local or governmental
information We believe this information to be accurate
but we cannot guarantee the accuracy of these sources.
If you are relying on information from these sources in
making a decision to purchase the home, you should take
it upon yourself to verify the accuracy of the information.
POSSESSION / UTILITIES
is not allowed to take possession of, or place any possessions
in the home until after the closing. The purchaser is
NOT allowed to do any repairs to the home prior to closing
or to turn on utilities until after closing (except on
HUD transactions. On HUD homes the buyer is allowed with
permission to turn on utilities for a 48 hour period to
allow the home to be inspected with written permission.
Please see the Home Inspection Policy addendum, please
ask for details).
GHOST / CRIMES
not have any knowledge as to if any previous owner or
occupant has been involved in any illegal activity in
the use of the home or if there has been any previous
deaths in the home, unless noted below. We do not have
any knowledge of any Ghost or spiritual entity in the
home. The next-door neighbors and local Police are the
best source of this type of information.
You should seek
the advice of a professional insurance agent for information
on the different types of coverage available on your home.
The Mortgage Company requires only that the home be insured
with a minimum of a Fire & EC policy. These policies do
not include theft or liability insurance coverage. The
homeowner's policies do have coverage for theft and liability.
FLOOD INSURANCE is a separate policy and is NOT included
in any of the above. See above for more information on
Flooding and Flood Insurance.
The insurance industry maintains a database of claims
by individuals and companies that have filed or asked
about filing claims on properties. This is know
as the CLUE database and they will use a report generated
by this system to rate your cost of insurance. You
should ask your agent to pull this report for you before
he quotes your estimated premium on the home.
THREATENED or ENDANGERED SPECIES
recommended that you obtain a report from a natural resource
professional to determine if there are any threatened
or endangered species, or their habitats located on or
near the home that you are purchasing.
at the Buyer's expense, is encouraged to obtain a report
from an environmental specialist to determine if there
are Wetlands, as defined by Federal or State Laws or regulation,
located on or near the home that you are purchasing.
WATER and UTILITY DISTRICTS
property is located in a Water or Utility District you
are required to sign an acknowledgment of that fact that
shows the tax rate and bonds issued. You should investigate
whether the district is financially viable, under capitalized,
or under protection of bankruptcy. You should also contact
the Texas Department of Health or Local City or county
Health Department as to current test results on the district
or city's water supply.
ENVIRONMENTAL and OTHER CONCERNS
today need to be concerned about many environmental items
that can affect a home. You are encouraged to investigate
on your own or hire an expert to determine whether the
home you are purchasing has any of the following items
of concern: Mold, Mildew, Radon Gas, possible allergens,
Lead Based Paint (see separate Lead based paint disclosure
forms), Lead Contaminated Mini-Blinds, Contaminated water
and or plumbing fixtures, Asbestos (Insulation - Siding
- Tile, etc.), UFFI (Urea-Formaldehyde foam Insulation),
Formaldehyde Gas / Radon Gas, Biological pollutants such
as bacteria, viruses and fungi, Volatile compounds found
in cleaning and repair work, Tobacco smoke, Mold and Mildew
due to water leaks or flooding, Combustion by-products
from wood, coal or oil, Poly Buteline Plumbing, Defective
galvanized plumbing pipes, Pesticides (including but not
limited to Chlordane, DDT etc.), PCB's (Polychlorinated
Biphenyl), Aluminum Wiring / defective wiring, Water Well
and Septic Systems, and Any other items contained in -
on - under - or above the house or property that you are
considering purchasing. The Buyer at Buyer's expense is
encouraged to obtain an Environmental Assessment Report
prepared by an environmental specialist.
HUD 203 K Loans
LOANS are very complicated. If you are a novice home-buyer
you may wish to seek advice from the loan officer before
purchasing a home with this program. We will be glad to
give you a HUD booklet on this program and we will supply
you with a copy of the actual HUD manual on this loan
type should you wish to purchase a home with this loan.
THIS IS A DISCLOSURE BY EAGLE REALTORS®,
and applies to the purchase of HUD Owned Homes.
BROKERS AND AGENTS TO THE BUYER.