When buyers purchase a foreclosure home, they should not be surprised if the house is damaged or in a state of disrepair. Even if previous owners did not cause any damage, banks do not take care of properties while they have possession, which means that the condition may deteriorate rapidly. But purchasers often have no one to hold accountable for damage to the house, as the bank protects itself and former owners are no longer responsible for the house after the foreclosure.



If a new owners bought a foreclosed house from a mortgage company in "As Is" condition, then there may simply be no one to sue for damage to the property. It will be pretty clear to a judge from the as-is clause in the real estate sales contract that the buyers purchased the house understanding that there may be severe problems with it and that the bank was not taking responsibility to fix these problems before the sale.

If the house was not bought in as-is condition, then the new homeowners would have to sue the mortgage company that the property was purchased from. The bank was the previous owner of the house due to the transfer of legal ownership from the foreclosure sheriff sale and was responsible for upkeep and making sure it was in salable condition. This makes it the only party to sue for damage to the house, but only if the property was not sold in as-is condition.

But there is little chance the new owners would have any case against the former homeowners who lost the house to the foreclosure process. And anyway, they went through foreclosure and lost their home -- it is unlikely that they will have much money to collect for repairs to a property they no longer own. Furthermore, they can not even borrow money to pay the judgment against them if they are sued for damage they may have caused before they moved out.

The foreclosure victims have no responsibility for the house after their ownership interest has been transferred at the county property auction. At that point, it is up to whoever purchased the property (usually the bank) and that now owns the house either to disclose any problems before the sale or have them repaired.

Since banks do not care to do much with foreclosures, though, it is more likely it will sell the property in as-is condition and let the purchasers know the lender will not take any responsibility for anything wrong with the house. This is one excellent reason why foreclosure buyers usually have their own home inspection done before closing on the house. If there is a lot of damage, either the price will be negotiated down to take into account repair costs, or the buyers may simply walk away from the deal.

If the lender does not sell it to the buyers in as-is condition, then it might be responsible for making any repairs to the house for damage that was never disclosed to the purchasers during the sales process. But the owners would have to sue the bank responsible for disclosing the damage -- not the former owners possibly responsible for causing the damage.