"HUD Homes for Sale" is the heading on an advertisement that appears every two weeks in The Washington Post Real Estate section.

The ads list houses--usually a dozen or more--in the metropolitan Washington area that individuals can purchase from the Department of Housing and Urban Development. And it's not difficult. Minimum bid prices range from $8,000 to more than $100,000.

HUD has acquired the houses through foreclosure when their owners, who hold FHA-insured loans, can't meet their monthly payments.

Through the bidding process outlined in the ads, HUD has sold 99 houses in Washington, Maryland and Virginia in the current fiscal year, and another 114 are sold but have not gone to closing, according to Robert A. Pascucci, property disposition chief at HUD's D.C. office. In addition, as of Monday, there were 105 more houses in inventory without outstanding sales contracts.

HUD has acquired many more houses this year than last, Pascucci noted. During fiscal 1982, HUD sold 57 houses in the area.

Pascussi said a house that might have a "listing price" of about $8,000 could be "virtually a shell," while those with prices ranging as high as $100,000 are very nice houses previously owned by people who simply ran into financial difficulty.

Because HUD entertains bids for the properties, which are sold "as is," some of the houses listed sell for more than the prices listed in the ads. For example, a three-bedroom house at 1223 Duke St. in Alexandria advertised for sale on July 24 had a listing price of $42,100, but actually sold for $65,000.

Another house, a two-bedroom structure at 2013 Evarts St. NE, was listed at $39,900 and was sold at first for $52,007. Because the first buyer backed out of the contract, HUD accepted a backup offer of $47,151 for the house.

HUD will entertain a bid below the listing price but has discretion not to accept it, Pascucci noted.

Here is how the process works:

Once HUD acquires a property, the agency determines a listing price after taking into consideration the estimated value of the house. A house is not offered for sale merely for the amount owed on the loan. Then the property is listed in the ads, which appear every other Saturday.

A prospective purchaser must make a bid through a local broker, who is paid a 6 percent sales commission by HUD upon closing, Pascucci said. Most brokers in the area participate in the program, he added.

The broker shows the prospective buyer the property and fills out all the paperwork if the prospective buyer wants to bid on the house.

The properties are advertised first under a bid period and then, if a property didn't sell the first time, on a first-come, first-served basis. If a property continues not to sell for a couple of ads, it is analyzed a second time and the listing price is reduced, Pascucci said. Then it goes back, with a new price, into the bid-period listing.

The bid period for a house being offered for the first time runs 10 days. Then there is a bid opening, and the highest bidder gets the nod. The high bidder is given 72 hours from the date notified to bring in his or her earnest money deposit--5 percent of the bid--and sales contract.

If that is done, the purchaser gets a letter of acceptance ratifying the contract and has 45 days to go to closing. Extensions of 15 days are allowed if the buyer explains in writing that processing for financing is in the works.

When a house is offered on a first-come, first-served basis, it is sold to anyone who walks into the office first with earnest money, a sales contract and broker's tender all properly filled.

If there is a tie bid, the preference is given to a person who intends to buy the house and live in it rather than an investor. When there is a tie and both prospective buyers are proposed owner-occupants, HUD holds a drawing.

The houses offered by HUD recently have been sold in the condition that the buyer finds them, unrepaired, with no warranty, and they haven't been eligible for HUD mortgage insurance.

HUD pays all discount points and most closing costs.

One risk: If the purchaser doesn't go to closing, he or she loses the earnest money. CAPTION: Picture, This house at 1223 Duke St., Alexandria, sold for $65,000. By Graig Herndon--The Washington Post