The banks are require to know everything that they know. But they generaly do not know much, they have not been living there. They generally do not know if changes or additions were permitted, or if there is mold, and they would have no knowledge of the things that most home owners would. And an inspector’s job is not to determine when a freeway will be built or if there is a graveyard under the house.
It was not just wrong for me. Some of what you had to say about REO’s was wrong. No seller has to provide an inspection, that is the buyer’s option. It does not take long for the bank to accept an offer, And it does not take any longer to get financing, if you are having a problem switch lenders. Yes a REO will probably need some defered maintrenance completed. A good rule of thumb, figure at least $10,000 as a starting point for repairs before moving in.
As an example our house $7,500 pluss $5,100 for a new forced air heating system. And the bank paid for the heating.
Does not matter who you buy from, do a personal inspection. Have an inspector inspect. Study the area for things like freeways. Look at the neighbors. Inspect the area. Does not matter if it is REO or private party. Do the due dillagence. it is the same.