Belt Auction

Can I conduct a home inspection on an REO property I won at an auction?

My parents recently "won" a property on auction. The home is an REO and in good condition, but not great condition. The winning bid did not meet the reserve price, so the sale is pending upon the approval of the asset manager. However, my parents are currently in escrow right now and have made a deposit on the home. Although we realize the home is being sold "as-is", my parents still want to conduct a home inspection. If the house is in terrible condition, my parents may want to back out of the offer knowing that we will lose part of the deposit. The selling agent on the home is informing me that we are not allowed to do a home inspection until the close of escrow and we are not allowed on the property. Given that we are in escrow already, does this sound right? Shouldn't we have the right to conduct a home inspection and know what we are buying? My parents have been to the home and did a walk through of the property, and it does look sound, but we would like a formal inpection nevertheless. The agent did tell us that we were supposed to do the home inspection 2 weeks prior to the auction (during the open house period), but my parents didn't want to do an inspection and pay $400 on a property they weren't sure they were going to get. Is this agent correct? TIA

Public Comments

1. Yes, this sounds right for an auction. There is no backing out. They will force the sale if they want it, if they have to sue your parents. Auctions have no contigecies at all. You bid, you pay.
2. REO inspections are quirky. I agree with you that you have a right to review a property before you close escrow. Since the agent does not own the prop, he/she cannot legally advise you. Since you do not have your own agent, call the bank and ask for written authorization to enter the home. I can't see why they would refuse you. IN the future, you have a right to condition a bid to state that you will be granted permission to do a full walk through inbetween being the highest bid and escrow closing. In the future, try either instead or in addition, to REO properties, county treasurer TAX sales. MUCH better deal $ wise. Also, unfortunately, you may not walk through the house till you are the winning bidder and have paid the taxes!! and you can always get a broker's opinion before even making a bid!!