Northern Michigan Real Estate

If any of you have dealt with REO properties, you are probably well aware that they typically do not come with property disclosure statements from the lender.  This doe snot relieve the lender-seller of their legal obligation to disclose all known defects to a buyer.  The lender-seller is most likely not aware of all of the property's defects. 

If the lender is indicating that they will not be providing property disclosure statements, a buyer's broker would advise the buyer to request the property disclosure statements in the offer.  Before the buyer agrees to waive the property disclosure, they should be provided with a blank copy of the disclosure form.  This will enable the buyer to make an informed decision regarding whether or not to waive the property disclosure documents.  The buyer's broker would be wise to obtain the buyer's written acknowledgment of receipt of the blank form.  The buyer can and should utilize this document as a checklist when conducting their inspections.

Foreclosure transactions are exempt from Federal lead-based paint law.  Let me define this a bit further.  A trustee at a foreclosure sale who is enforcing the terms of a deed of trust is not considered a seller and is therefore not required to make the lead-based paint disclosures.  However, when the lender becomes the owner at the trustee's sale, the lender is required to comply with the lead-based paint disclosure law when they sell the REO.