FHA 203K is a loan that FHA insures by financing required repairs, min amount of repairs need to be $5,000.00. Here is a website to FHA 203k:
Depending upon which FHA product you are using, your lender may not fund for this home. Please verify with the lender about the HW tank before committing to paying for an inspection and having utilities turned on and off.
In general, banks will not pay for anything other than safety issues and not always then.
Sonya did reference due to any delays request utlitllies in your name, not expensive have the inspection completed.
Foreclosures in many instances could be missing some appliances the hot water heater is a minor. If you do pursue the purchase just have a hot water heater purchased, delivery and installation on the day of closing.