John's Blog



As we all know there are many foreclosures on the real estate market at this time. While these can seem like a good bargain, it's critical that the transaction be properly handled during the inspection process.

Home inspectors are finding many problems that are unique to the purchase of foreclosed or abandoned properties. The following is a good list of these specific issues.

1. Bank foreclosures, REO's (Real Estate Owned by banks), etc., have no obligation to disclose any issues and work to deny any liability for any issues found wrong with the property after the purchase.

2. Owners who run out of money may remain in the house for many months or years without doing any maintenance or repairs to the property thereby allowing the property to deteriorate.

3. Sabotage and vandalism are often found. There are garbage disposal systems and sewer pipes deliberately clogged with concrete, gravel and other debris and there is often damage to the property by banging holes in walls, breaking windows, doors, etc.

4. Removal of components such as appliances, toilets, light fixtures, cabinets, fancy tiles, water heaters, air conditioning systems and pool equipment have occurred. The copper water pipes and copper electric wiring have been removed and sold for scrap.

5. Sometimes pools are drained to cut down on the banks monthly expenses, which can create other issues such as plaster and tile cracks in the concrete walls of the pool. Pools can also shift and lift out of the ground when the weight of the water is removed. Sometimes pools are partially full of water but are not maintained, allowing the water to turn into a green algae mess and a breading ground for mosquitoes.

Houses that are left vacant with services turned off create other special issues as well.

1. Sink, tub and shower faucets can become clogged with rust flakes and debris restricting the flow of water. Also, valve washers dry out and crack so they often leak when turned on after sitting for extended periods of time.

2. The hair, debris, toilet tissue and roots that normally are softened by a daily flow of water through the drainpipes can harden into solid masses creating clogs that can cause drains to back-up and overflow.

3. Vacant houses often have the water, gas and electric services discontinued. Buyers and agents need to verify that all of the services are turned on and all of the systems are ready to be tested prior to the property inspection. Unless all of the services are on and the systems you want inspected are ready to be tested, the property inspection may need to be rescheduled so it can be performed when the property is fully ready. If an inspector has to be rescheduled additional charges may be incurred.

4. Vacant houses that are left sealed up for a while often have mold issues due to constricted air flow.

This is not necessarily a complete list. It's possible to have various issues that are specific to an individual property.

Banks are often not very cooperative through this process so a buyer's best protection from incurring additional costs during the escrow period and unforeseen unpleasant surprises after the close of escrow is to do their due diligence. Professional home inspections, sewer line inspections, chimney inspections, and mold inspections should be standard with foreclosure purchases. Reviewing city building permits, tax records, talking to neighbors, and any other area of concern should be part of the buyer's due diligence.

There is a new definition of the "Wild West" and it comes in the form of staking your claim to a piece of real estate. Being diligent can help make buying a home the "American Dream" and not your personal "American Nightmare."

By John LaRocca, Certified Real Estate Inspector and Licensed General Contractor. 818/951-1795 or John.Larocca@LaRoccaInspections,com

Comment balloon 11 commentsJohn LaRocca • April 11 2008 08:09PM


Sounds like the good ol' days when I first started in this business.
Posted by Patrick Lambert, Hawaii Real Estate Expert (ALLY Real Estate) about 12 years ago


I am not surprised to read of all the issues that an inspector faces with homes that are being foreclosed on and or our REO's. The sad part is that many buyers haven't factor in all the cost that will be involved. Home Warranty program will not cover concrete in the toilets, or down the garbage disposal.

Posted by Lorraine or Loretta Kratz, Certified Negotiation Consultants (Crescent Moon Realty, Inc. & Land N Sea Auctions.) about 12 years ago

you are so right.  in FL part of our standard as-is contract is that the seller must provide utilities for inspection but the buyer must be extra diligent during the inspection period.

these days I'm not seeing much vandalism just deferred maintenance, which can be serious as you described.  REO's are certainly not the type transaction to rush thru the inspection.

Posted by Wendy Smith, Real Estate Advisor (Wendy Smith Real Estate) about 12 years ago

Hey John,

I can tell you that I respect what you do and I appreciate you and your role in the process of home buying and selling. I certainly wouldn't want to do it! I'm glad you're the expert and that you're there to get the job done!

Welcome to Active Rain! 

Posted by Kirk Westervelt, Kirk Westervelt, Broker In Charge, Van West Realty - CDPE - Short Sale Agent - Home for Sale - Greenville, Simpsonville, SC (Van West Realty - Greenville, SC Realtor -Short Sale Expert!) about 12 years ago
John- You are so right about the issues, I once went in a foreclosure and I couldn't tell where the kitchen was except for the plumbing, the previous owners had taken out everything including the cabinets.
Posted by Pam Joffe (Solaris Realty) about 12 years ago

Hi! Welcome to the site. I see this is your first post.

There is a lot of reading on this site. I recommend that you read, read, read and then comment, comment, comment. There are so many different blogs to read. There are tons of topics out there from real estate, marketing, technology, seo, staging, mortgage, etc. It goes on and on. You'll start to get to know people and before you know it... you'll have figured out the benefits of the site. 

Also check out Resources for the Active Rain Newbie.

Good luck!

Posted by Angie Vandenbergh, A Crye-Leike Blogger (Crye-Leike, Realtors) about 12 years ago

Welcome to active rain!  I can already tell you are knowledgeable and will have a lot to share.  This is a great forum, so get out there, read, comment, and post!

Again, welcome!


Posted by Bill Kennedy, Homes For Sale Greenville SC (Keller Williams Realty) about 12 years ago
Welcome to Active Rain!!!!  Make sure to check out other blogs so you can see what works and what does not.
Posted by Ted Mackel, Simi Valley Real Estate Agent (Keller Williams Realty Simi Valley) about 12 years ago

Welcome to Active Rain! For some tips on how to get started here, check out my blog entry at ActiveRain Fast-Start Tips for Quick and Easy Points

Happy blogging and good luck!

Posted by Benjamin Clark, Buyer's Agent - Certified Negotiation Expert (Homebuyer Representation, Inc.) about 12 years ago
John, Welcome to Active Rain and congratulations on your first blog.  I recommend reading and commenting on 10 blogs a day to get the most out of AR.
Posted by Jimmy McCall, The Ex-Mortgage Consultant ( about 12 years ago
Thanks for all o f the feedback on my first blog and all of the great advice on how I can make the most of Active Rain.
Posted by John LaRocca (LaRocca Inspections) about 12 years ago