Right Time to Buy Indianapolis Hud Homes for Sale?

By: Al Hardymon

How is the market for Indianapolis HUD homes? One word, Great!

First, what are HUD homes?

A HUD home is a 1 to 4 unit residential property acquired by U.S. Department of Housing and Urban Development (HUD) as a result of a foreclosure action on an FHA-insured mortgage. HUD becomes the property owner and offers it for sale to recover the loss on the foreclosure claim.

The number of central Indiana HUD homes sold in 2006 (as of 10/31/06) is up over 70% for the same period in 2005.

The overall rate for Indiana foreclosures is usually in the top ten for the nation. The Indiana foreclosure rate for the 3rd Quarter of 2006 is up 40% over 3rd Quarter of 2005.

According to RealtyTrac first annual 2006 U.S. Metropolitan Foreclosure Market Report, Indianapolis leads the nation in having the highest foreclosure rate among the nation's largest 100 metropolitan areas. The report documented an Indianapolis foreclosure rate of one foreclosure for every 69 households.

Sales of HUD homes in Indianapolis area and central Indiana represents almost 7% of the market for single family residential properties.

HUD homes in Indianapolis area are not just old houses ready to fall down. Almost 50% of the Indianapolis HUD homes sold in 2005 and 2006 are less than 10 years old, 35% less than 5 years old.

Why are new homes going into foreclosure in the Indianapolis area?

It is my opinion some of the large Indianapolis area home builders have been too aggressive in getting new home buyers into homes.

In order to get some new home buyers qualified for mortgages they will do a 2-1 or 3-1 buy down of the interest rate. Also, in Indiana we pay property taxes in the arrears. The property taxes for a new house initially would be only for the lot because the house hasn't been assessed yet.

In a couple of years the interest rate and property taxes will go up, just increasing the home buyer's payment $200-$500 per month. They can't make the mortgage payment and the property goes into foreclosure. Unfortunately for the home buyer the property becomes one of many Indiana foreclosures. If it was financed by a FHA insured loan it will become an Indiana HUD foreclosure.

What does all this mean to you? It means great opportunity for you!

If you are looking for a home at a bargain price or a great investment property in central Indiana, one of the 300 Indianapolis HUD homes currently on the market may be just what you are looking for. The time is right to buy Indianapolis HUD homes!

You can do a search for Indianapolis HUD homes on my website and also learn more about how to buy HUD homes for sale.

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