There are Risks involved, but you can minimize these risks just by doing some due diligence.
1.) When signing the bank addendum, (a document the banks add on to the actual contract) make sure you realize what type of deed you are going to receive. If it is not a General Warranty Deed, make sure you are getting the home and you fully protected with the most title insurance you can. Most banks will issue you a Special warranty Deed, in Arizona. If this is the case, you should look into extending your insurance policy to cover any gaps.
2.) Because the bank acquired the property through foreclosure, the bank will not be able to provide you with the (SPDS)Seller's Disclosure or the (CLUE Report) Insurance disclosure. So, be aware this means you know nothing about the history of this property...it could have been flooded, had a leak in the roof, or anything else that might be of concern to you. So this means you need to do some leg work to find out what you can about this property. Use this to help; http://www.aaronline.com/documents/buy_advis.pdf I suggest to try to get a Home Warranty on the home if you can...I call it a safety net for the first year.
3.) Make sure you know your inspection time and do all inspection you are concerned with at that time. I.E. Home, Pest, termite, Pool or Roof inspection, even check the square footage- whatever is your concern. Usually, they give you 10 days for inspections and to lock your rate in to purchase the home (yea, there is a provision for this in the standard Arizona contract). But some bank addendums will modify this an only allow you 5-7 days. that is critical to know, as after that period you will only be able to walk away with your earnest money if you don't qualify for the loan.
4.) Understand, that when asking for concessions from the bank this amount will be provided at the time of closing. So you will need cash in hand to pay for inspections and appraisal(s) and sometime even the HOA disclosures as the HOA is now in some cases charging an upfront fee for these.
If you use this guide, you will have a good chance to find a good deal in the bank owned properties for sale in Arizona.
Of course, if you want more information I would be happy to help you can call me at 480-570-1912, email me at BeeryRealty@gmail.com
You can find me on the web at two websites, http://www.AzBuysHomes.com or at http://www.AzSellsHomes.comTake care,
United Broker's Group