Markdown_files/FHA handbook/page_1717.md

# IV. CLAIMS AND DISPOSITION

## B. Title II Disposition

### 2. REO Property Disposition

For closing costs claimed on discount sales to Governmental Entities and HUD-approved Nonprofits, HUD will deduct any closing costs paid from the total discount amount.

#### (B) Other Financing and Closing Costs for Properties in Competitive Sales

##### (1) Standard

For Properties sold in competitive sales and not in GNND transactions, HUD will pay the buyer’s actual financing and closing costs as requested on Line 5 of form HUD-9548 in an amount up to 3 percent of the Property’s gross purchase price, provided that the costs are reasonable and customary in the jurisdiction where the Property is located. The gross purchase price is the bid price before any subtractions requested by the buyer for financing and closing costs, and the broker’s sales commission.

No assistance for financing and loan closing costs or for broker’s sales commission will be provided to Investor Buyers.

HUD will retain any Line 5 funds not used at closing.

##### (2) Required Documentation

The buyer must identify on Line 5 of form HUD-9548 their requested financing and closing costs.

## v. Closing Process

### (A) Closing Agent Assignments

The AM will provide the Closing Agent with the following items:

- fully ratified sales contract and addenda;
- title evidence (when available);
- wire instructions;
- pre-closing and post-closing instructions;
- HOA documents, if applicable;
- all outstanding property bills; and
- any other documentation deemed necessary by the COR.

The AM will provide these documents within two business days of the AM’s ratification of the sales contract, the issuance of the HUD-issued Title Identification (ID) Number, or, for ACA sales, receipt of the fully executed Notice of Acquisition from the ACA participant.

**Handbook 4000.1**  
Last Revised: 01/1688  
10/2025