1. Expect the property to be in terrible condition. Many foreclosed homes were abused as the former owners realized they were going to lose the home to the bank. Often the home has damaged and missing items. (A friend just sold one with NO KITCHEN. Additionally, the first thing a lender does is turn off the utilities. Gas, Electric and Water. Any landscaping will die, the pool will turn green, gaskets and seals in the plumbing will dry out.
2. The home is being sold AS-IS and with no disclosures. That is reasonable, after all, the lender has never lived in the home, and may be located in a far away city. HOWEVER, this means inspections and careful consideration of possible costs are very important to you when you buy a foreclosed home.
3. Here is a GOOD One! Expect the addendum or counter offer from HELL. The lender Will send a counter or addendum 7 or more pages long that will attempt to remove all protection for the buyer, and bias the proceedings in the lender’s favor. It is IMPERATIVE that you have an experienced agent to help you. The lender will negotiate on some of the items in this counter. A good example is the offer includes 10 days for the buyer to make inspections. Lenders will often counter with 5 to 7 days. Yes, you can insist on 10 days. This is just one example, there are hundreds more.
4. There will be HUGE communication problems. Listing agents dealing in foreclosures are notorious for not answering phones, returning phone calls or reading/answering emails. The lenders they represent are far, far worse, and will only communicate by email or fax. The title companies (chosen by the lender, not the buyer) are swamped but try to help.
5. There will be many delays and closing may be late. If the delays are on the lender’s side, too bad, you will have to put up with it. If the delay of closing is on the buyer’s side, the buyer will be charged $100  a day or more until escrow closes.

Jim Little, YOUR SUN CITY REALTOR