Negotiating a contract to purchase a bank owned foreclosed home requires caution. In most cases, the bank is selling the property in "as is" condition. The bank is making no representations or warranties on the condition of the home. WHAT YOU SEE IS WHAT YOU GET.
Your contract with the bank should allow you to conduct a professional home inspection. Since the bank, in most instances, will not make any repairs to the home or provide any repair credits at closing, it is important to determine the condition of the home and to have the option to cancel the purchase if you discover any major defects. You also want to have all utilities turned on at the time of the inspection.Water, gas and electric must be functioning so your inspector can determine the condition of these systems.
Also, consider asking the bank to provide a survey or at least to allow you to obtain a survey. A survey is a diagram of the property you are purchasing. It will show where the home is situated on the lot lines and if it encroaches onto neighboring property. It will also let you know if the neighbor's home or improvements encroaches on the property you wish to buy. Never buy a home without obtaining a survey.
Especially in Illinois, it is important to involve your attorney right away when purchasing a foreclosed home. An experienced attorney can make sure the contract contains provisions protecting you as the buyer.
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