Answering HUD Questions: What is Repair Escrow?

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Real Estate Agent with Cherry Creek Properties, LLC

Answering HUD Questions: What is Repair Escrow?

Before a HUD home is listed, it is inspected and appraised.  Any issues regarding the condition of the home are identified and a value is determined for the list price of the house and the estimated repairs.  The Repair Escrow is the result of this inspection.  When searching for an available HUD home property on the www.HUDHomeStore.com website, the Repair Escrow (if applicable) will be reflected on the property detail page.  (See sample below.)

HUD Homes

Additional information and a breakdown of the Repair Escrow can be found by clicking on the "Addendums" tab.  In the example above, monies are estimated for the replacement of rotting and missing siding, repair of copper piping at the furnace and electrical re-wiring.  Common repairs include: repairing/replacing drywall, repair/replace plumbing, mold mitigation, repair/replace bathroom tile and HVAC repairs/replacement.

Please note: HUD does not pay the repair escrow.  This is a cost to the potential buyer that will be included in their new loan.  It must be paid in order to purchase the home and make the appropriate repairs.  It is not included in the purchase price.

 

(HUD is the U.S. Department of Housing and Urban Development.)

If you are interested in learning more about HUD Homes or scheduling a showing of a HUD Home in the Metro Denver area, please contact The Foerster Team at (720) 530-5553.

Watch this blog site for available HUD Homes in Douglas County and the surrounding areas and additional information regarding HUD Home programs and purchasing HUD Homes.

What is a HUD home?

How do I search for HUD homes?

What are the benefits of registering on the HUDhomestore website?

How much information will I find on the HUDhomestore website?

HUD Special Programs

Who Can Purchase a HUD Home?

Should I Have My HUD Home Inspected?

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Donna Foerster

The Foerster Team

Cherry Creek Properties, LLC

www.TheFoersterTeam.com

720-530-5554 (cell)

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Topic:
Home Buying
Location:
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Groups:
Advice for Buyers
Never Answer The Same Question Twice
HUD Homes
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Rainmaker
116,757
Myers Jackson
Auctioneer
Real Estate Auctions, Land Auctioneer

Hello Donna thanks for posting the information on HUD escrow, this is very important details at the closing table 

May 22, 2011 06:21 PM
Ambassador
705,083
Debb Janes
REALTOR®, EcoBroker Camas, Washington
The Carl Group, LLC

Happy Sunday Donna. Is the scenario you're talking about part of the 203K loans or do other programs also offer this? 

 

May 22, 2011 06:31 PM
Rainmaker
336,589
Jennifer Prestwich
Your Castle RE Colorado
Henderson, Thornton, Broomfield and Westminster

Donna- GREAT post.  I did a post today about "Techtalk" and this fits right in with that.  We get used to talking about all of this 'stuff' and forget that the average consumer doesn't know it.  Love the clear, concise explanation!

May 22, 2011 06:35 PM
Rainmaker
236,633
Judy Klem
Home Staging, Senior Move Management, Fairfield/New Haven counties
Transition Stage LLC

Hi Donna - Very informative and well-written post! I hit Suggest.

May 22, 2011 07:11 PM
Rainmaker
856,467
Donna Foerster
Metro Denver Real Estate Agent
Cherry Creek Properties, LLC

Hi Myers~ Purchasing a HUD home can be a complicated process. 

Debb~ This is outside of the 203k loan.

I'm going to go check out your post Jennifer!  It's so important for us to keep consumers informed!

May 22, 2011 07:12 PM
Rainmaker
856,467
Donna Foerster
Metro Denver Real Estate Agent
Cherry Creek Properties, LLC

Thank you Judy~ I believe it's my job as a professional to educate the public. 

May 22, 2011 07:27 PM
Rainmaker
469,822
Teral McDowell
I am a Texas Realtor. I sell the land that I love.
Keller Williams Central

Good info, Donna, I should hone up on my HUD skills as they are always around.

May 22, 2011 08:19 PM
Rainmaker
856,467
Donna Foerster
Metro Denver Real Estate Agent
Cherry Creek Properties, LLC

Hello Teral~ You never know when you'll get the call to write an offer for a HUD home purchase!

May 22, 2011 08:24 PM
Rainer
76,672
Jason M. Keith
Lending in 5280
WR Starkey Mortgage

This is a great break down Donna.  I've done a few HUD homes and the ESCROW question always comes up! 

May 23, 2011 12:09 PM
Rainmaker
856,467
Donna Foerster
Metro Denver Real Estate Agent
Cherry Creek Properties, LLC

Hi Jason~ It is a fairly common question about HUD Homes.

May 23, 2011 12:14 PM
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Pat Haddad
Carmel IN Real Estate Expert
Keller Williams Indianapolis Metro NE

Hi Donna--I will just bet that even more than buyers appreciating this post---other agents will.    There is a lot to know to do a HUD deal and much of it gets learned 'on the job'.  You are a good teacher!

May 23, 2011 08:25 PM
Rainmaker
856,467
Donna Foerster
Metro Denver Real Estate Agent
Cherry Creek Properties, LLC

Thank you Pat~ That's the best thing about blogging, sharing good information and educating others!

May 23, 2011 08:28 PM
Rainer
9,216
Dave Jaeger
Dave Jaeger
Colorado Homes Team

Great info -  in the midst of my first HUD deal, not so pretty! I have a cash Buyer and was wondering if this escrow needs to be paid off to close out the transaction?

 

Thank you! :)

September 25, 2012 08:07 AM
Rainmaker
856,467
Donna Foerster
Metro Denver Real Estate Agent
Cherry Creek Properties, LLC

Hi Dave~ Not sure how that would be handled with a cash buyer.  That's a great question.

September 25, 2012 01:12 PM
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Donna Foerster

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