HUD Sells 4,200 Dead Grandma Houses: $1.3 Billion Garage Sale
Published Date: 9/23/2026
Notice
Summary
HUD is selling about 4,200 reverse mortgage loans tied to vacant homes, totaling around $1.3 billion. This sale helps reduce financial risks and clears out properties where borrowers have passed away with no surviving spouse. Bidders can get info starting September 17, 2026, and must submit bids by October 27, 2026.
Analyzed Economic Effects
6 provisions identified: 2 benefits, 4 costs, 0 mixed.
HUD offering ~4,200 vacant reverse mortgage loans
HUD is offering approximately 4,200 home equity conversion mortgages (reverse mortgage loans) secured by vacant single-family properties, with a combined loan balance of about $1.3 billion, in a competitive sale to be held October 27, 2026. The loans are due-and-payable Secretary-held HECMs where borrowers and co-borrowing spouses are deceased and no non-borrowing spouse survives.
Loans sold without FHA insurance and servicing released
HUD will sell the reverse mortgage loans without FHA insurance and with servicing released, meaning successful bidders acquire the loans without FHA insurance coverage and servicing will be transferred away from HUD. These are Secretary-held, due-and-payable HECMs.
Bid deposit required and applied to sale price
Successful bidders will be required to submit a deposit calculated based on the total dollar value of the bidder's potential award; the deposit must be provided in the timeframe outlined in the bid deposit confirmation and will be applied to the sale price at settlement.
Sale timeline and due-diligence access
The Bidder's Information Package (BIP) will be available on or about September 17, 2026, bids must be submitted on October 27, 2026 prior to 1:00 p.m. ET, HUD expects to make awards on or about October 30, 2026, and deliveries/servicing transfers will occur no later than 60 days after the Award Date. Eligible bidders may access due diligence materials remotely via high-speed internet as described in the BIP.
Qualification rules and bidder ineligibility list
To be eligible to bid, prospective bidders must submit a Confidentiality Agreement, Qualification Statement (HUD-9611), and an Attestation; HUD removed the prior HUD-9612 addendum requirement for nonprofit and governmental bidders for this sale. Entities are ineligible if, among other things, they are debarred/suspended, have had Ginnie Mae issuer rights terminated, are HUD Office of Housing employees or household members, contractors who worked on the sale, or persons who acquired material non-public information.
Possible public disclosure of winning bidders and bids
HUD reserves the right to disclose the identity of any successful qualified bidder and its bid price or bid percentage for any pool or loan upon closing of the sale, and HUD will disclose information as required under the Freedom of Information Act (FOIA).
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