DEFECTS: Seller warrants subject property to be free from hazardous substances and from violation of any zoning, environmental, building, health or other governmental codes or ordinances.

@Kris Haskinsone can not hide know defects, cover them up, or lie about them, Whether a broker or an owner.

I keep hearing from my lawyer and agent that "Per the contract, the requests should be limited to major defects as opposed to routine maintenance or minor issues."

Most REO properties which are sold retail, are sold with title insurance, however there are properties from the heady real estate markets frenzy of 2006-2007 with major defects that are still working their way thru the system.

A lenders definition of livable is very different from my own ;)  Stay away from major defects and mold - a good foundation, working mechanicals, a toilet, and a stove are pretty big requirements ;)

The first and last owner/builder custom spec home project I insured resulted in a $400,000 construction defect claim with 11 months of litigation.

Try to uncover as many defects as possible. 

They buy "scratch and dent" loans which means that the loans have fraud or other defects in them and so they have taken on the liabilities of those loans as well.

When you sell, you are required to disclose all known defects.

They didn't want to bother me, so they never said anything.Anyway, a couple of months ago 1 of the guys collapsed with a heart defect and supposedly during some examinations they said he had a little mold in his lungs.