My team focuses on what are known as REO, or Bank Owned properties (that includes government owned ones, too, fyi). One thing that comes up from time-to-time is on the form 17, which is the disclosures sheet. In a “normal” transaction, the seller will fill this form out stating the current state of the property, itemizing any issues.
Since the bank took over the property in a foreclosure and has never occupied it, they have no knowledge of the property’s state. Thus, nothing to disclose, thus (2) a blank form. There is a spot, on the last page (page 5) to “waive” this form (we go the additional step to add lines on the form and such, to make it abundantly clear). Several institutions (ie: HUD) won’t sign as sellers, but we collect the buyer’s side for the sake of state compliance.
So, to sum up: banks “don’t know nothin'”, thus cant’ disclose “nothin'”.
