ANYBODY can buy a HUD home. Sam Walton can buy one if he wants to - they are NOT looking for people with low income, nor are people with low income prioritized. If you want to get a loan, then you must qualify for your loan the same as with any home purchase. There is a preference given to owner occupants, however investors may place their bids at the same timeframe.
Bids are due by Sunday night - investors and owner occupants can BOTH place bids now. If no owner occupant bids with a high enough NET to HUD, then investor bids will be reviewed as well. If any owner occupant bids enough, then NO investor bids, no matter how high, will be reviewed.
The escrow $5,500. HUD groups their homes into three categories as far as condition is concerned.
IN - Insurable. Will go on an FHA with no repairs required.
IE - Insurable with Escrow. (yours) This home can go on an FHA 203b loan with the repairs listed being required - the buyer must have these done within 60 days after closing. Note that HUD does NOT give you this money. The buyer can either roll this extra money into their FHA loan and the lender will hold it until the repairs are done, or the buyer can bring the repair money to closing and the lender will hold it until the repairs are done. The IE group only goes up to $5,000 of expected repairs - they escrow 110% of the extimate (so your estimate is exactly $5,000) just in case.
UI - Uninsurable. Cannot be bought using an FHA 203b loan. The repairs to qualify for FHA 203b are over $5,000. It still might (or might not) be able to be bought using an FHA 203k loan. It will say in the website if it is elligible for 203k. If not (then the condition is REALLY bad), then it could only be bought with cash or a conventional loan - and maybe not a conventional loan either.
You need to be pre-qualified (not pre-approved) to bid on the house. Your Realtor must be registered with HUD, and your lender also must be able to fund HUD houses. Call them both quickly! If you are planning on living there, you have the advantage over investors until Sunday night. After that, it is just whoever offers the most net to HUD.
What state are you in? If in Texas, have your Realtor contact me and I may be able to help it get through.
17 years Texas Realtor - sold many HUD homes - live in one now.