Thread: Disclosure for Bank Owned Properties

It seems that I rarely inspect a traditional home transaction lately (Home selling by a Home Owner with equity to on the line). Many of the Bank Owned Properties that I have inspected recently have had freshly painted interiors, newly installed Laminate wood flooring and a few have had new roofing. Fresh paint looks great from the eyes of the Buyer and even better from the Real Estate Agents. A Home Inspector would think “What the fresh paint is covering! Our question is, was there damage to the drywall, mold or just fresh paint for eye candy, why did the bank want to spend all that money covering the flooring with floating Laminate wood flooring (What’s underneath the Laminate or new roofing).
Anyway; I was wondering if anyone is using a blanket disclosure statement for our recent wave of bank owned properties and if so what are you saying?

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No I just make notes about the fresh paint, carpets, and ?

As to why the banks spend the money to fix them up. you have some very good agent working in your area. they are the ones doing the fixing up. I have one agent in my area and thats and you know when you are in one of her homes. very nice. and she sells a lot of homes.


Best

Ron

Maybe they just needed new carpet and paint.

Disclaimers. No

Not in general anyway. I note new floor covering and paint and might express it a little more heavy if there looks (on the outside) that there has been past movement to the home even if minor. I tell them quite simply I cannot see thru walls and floor coverings. If you note the new interior finish and floor coverings you are covering yourself for anything they may come down the line.

That is the idea of the visual inspection on the main portion of the inspection. Of course if something jumps out at you then of course you would let them know. You don't have to cover yourself for something that is clearly not visible. Now the systems they cannot cover up and inspect them as you always would. You cannot be giving folks possible false readings if there is nothing to read. You don't find a home in great shape and then leave them with the thought that it is all fluff and buyer beware, danger, danger.

Originally Posted by Ted Menelly

...I cannot see thru walls and floor coverings.

Somewhere, I had a cool catalog that had things like cameras that could look through tiny holes in walls. Similar to this one...

RIDGID SeeSnake micro Inspection Camera

I hand prospective buyers of forclosed or repossessed homes an additional disclaimer that says this property may have more issues than normal. Reasons given are: Lack of maintenance due to lack of funds by previous owner; disgruntled, evicted owners being malicious; no utilities for an extended period of time and no disclosure by sellers.

I got mine somewhere on-line - maybe here.

Originally Posted by Duane Nelson

I hand prospective buyers of forclosed or repossessed homes an additional disclaimer that says this property may have more issues than normal. Reasons given are: Lack of maintenance due to lack of funds by previous owner; disgruntled, evicted owners being malicious; no utilities for an extended period of time and no disclosure by sellers.

I got mine somewhere on-line - maybe here.

If you have visual or testing evidence or first hand knowledge of all that may be fine. If you are speculating completely then that is realy out of line. I am asuming the place was a reck and had a lot of concerns. As far as no disclosure automatically may be the case most of the time but not always. The holder of the property may already been given a list thru the previous owners when the property started floundering in payment and they were still trying to save it.

People know they are buying an REO. Just do a regular home inspection and report what you find.

Ted,
I feel it is another cover-my-butt piece of paper and know it is probably worth no more than what it is written on. That said - it does reiterate what is said in the pre-inspection agreement that no one reads but everyone signs.