HUD Refunds

I have been writing about scams for the last three years and get about an email a month asking about HUD refunds.

HUD of course stands for Housing and Urban Development. HUD is part of the US Government that is responsible for making sure that housing laws are enforced, people are able to get into homes and everything housing wise runs smoothly.

By seeing this article in my not recommended section, please don't think that I am saying that HUD is a scam. Not at all. They provide a valuable service to folks living in the US that are trying to get into homes for the first time or people that are trying to buy inexpensive housing.

The problem is not with HUD but with some sort of insurance program they run. Again the program is not a scam but the way that some outside companies sell it. I am not an expert in HUD insurance so I won't go into any detail here. The important part is that there is a refund given to people when their home loan is completed. Most of these HUD customers can be found easily by mail and told about their refunds.

Many are still living in the house they bought that they bought with HUD's help. Other folks have either moved out of state. Some are very hard to find. HUD has an OK process for finding these folks but of course, quite a few of them slip through the cracks and don't know about their refunds.

The scam comes in the form of a business opportunity. There are probably at least a dozen, or more, companies that sell finding these HUD refund people as a business opportunity that they can run out of their homes. Here is how they say it works:

You buy their system for $39 and they will show you how to buy a list of people that are due refunds and how to find them. Once you have found someone that is owed a refund, you can contact them and tell them they have money the government owes them and there are a few problems with this process.

1. It is hard to find these folks. Unless you are a private investigator, you are going to have to turn into a bloodhound to find these folks. That doesn't even include if other people that are doing HUD processing are trying to find them as well.
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2. Some won't pay: You get people to sign an agreement that says they will give you 50% of the money that you get for them. Some folks aren't going to cough up half of the $1,000 (or whatever) when they do get the money. Are you going to sue them? Some of them may be out of state etc.
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3. A lot of work for not a lot of money: You may end up working a lot of hours just to find a few people. A lot of these refunds are just a few hundred dollars so half of that isn't exactly something to get that excited about.

When it comes to an opportunity like HUD refunds. I think that you are better off looking for something with a long term outlook. A real home business.

Matt Gagnon