A HUD home is a residential property that has been aquired by HUD through a foreclosure on an FHA-insured mortgage. HUD stands for Housing and Urban Development. Once HUD has the property they offer it for sale so that they can recover the loss on the foreclosure. HUD properties normally need some repair. Anyone can purchase a HUD home that is for sale by the U.S. Government but you must go through a broker or a real estate agent that is authorized to sell the HUD properties.

When you find a HUD home you want to buy, you will need a real estate broker to submit an offer or bid. HUD homes are normally sold within on offer period. At the end of this period, the sale goes to the highest reasonable bidder. If the home can't be sold in the initial period, you can submit a bid until it is sold. Bids are accepted any day of the week, even weekends and holidays. When your bid is accepted, your real estate agent will be contacted within 2 days

The Department of Veterans' Affairs (VA) buys properties from foreclosures of loans they guarantee or finance. For such homes, please have your real estate agent complete the Offer to Purchase And Contract of Sale VA form, which should be submitted for approval with your offer, through the listing broker.

A Real Estate Owned (REO) property, also known as a bank-owned property, is one that reverts to the bank following an unsuccessful auction for foreclosure. Because the amount owed to the bank on the property is usually greater than the equity in it, the bank in most cases will make an effort to get the best price it can for it. Typically, therefore, the bank will make a counter offer to your initial offer.

Bank forclosures are not always the great deal they appear to be. There may be other loans against the property and there is the possibility that there will still be residents on the property after purchase. You should make sure to ask for an inspection period so that you get a chance to investigate for any potential problems as a bank foreclosure will be sold "as is".

Any offer you make should be based on sound facts. For example, compare the prices of other similar homes in the same area, and also take account of any renovation costs you anticipate. But avoid a "bidding war" since you may well end up paying more than the true market value. Finally, inspect the property and before you commit to any deal make sure the bank takes responsibility for any needed repairs.