HUD Home Purchase: How to Choose a Closing Agent with Buyer’s Select
In 2013, the Department of Housing and Urban Development (HUD) modified its requirements for the purchase of HUD- owned real estate by creating the Buyer Select Closing Agent Program. A HUD home is a one to four-unit residence that has been acquired by HUD after a foreclosure on a Federal Housing Administration home loan. HUD acquires the property, and then puts it up for sale to try to recover the foreclosure loss.
In an effort to streamline the closing process, HUD no longer designates a closing agent for purchases through HUD. The new Buyer Select Closing Agent Program requires the purchaser to select a closing agent who will perform all of the services involved in processing and closing a HUD property.
Under Buyer Select, the responsibility of all the home closing functions transfers from HUD to the closing agent. Therefore, perhaps the best choice for a closing agent is an experienced HUD-approved attorney. Regardless of who you choose, they must meet the following requirements:
1. The closing agent must be approved by HUD to complete the transactions
2. The agent must strictly adhere to all HUD timelines and closing requirements
3. The agent must file all paperwork correctly, or mistakes will result in lost time, money and contract
4. The agent must clearly understand the state law and all of the intricacies in a HUD transaction.
Look for a high level of expertise in your closing agent. They should be able to fully and clearly explain all the changes associated with this new program. They should also have a proven track record of experience in error-free HUD closings.
As long as you are with a competent closing agent/attorney a HUD closing under the new Buyer Select Closing Agent Program should be perfunctory. Gardi, Haught, Fischer & Bhosale LTD is a HUD approved closing agent and has a second location with experienced staff specifically for HUD real estate purchases. If you are anticipating a HUD purchase or are in need of a closing agent, feel free to contact us at 847-944-9400.