This is located in East China, Michigan

I would agree with Derek. There may or may not be anything wrong with the home invisible to the naked eye. Foreclosure homes may also include "corporate addendums" or similar language.

Short sales may include "subject to 3rd party approval"

It is very common for banks and relocation companies to have many hold harmless type clauses in their contracts, as they have no first-hand knowledge of the property in a lot of cases. Don't rely on your contract documents for the condition of the property ... get both a thorough structural and air quality inspection. That bank is just making it clear to you that they will not be held liable for mold on the property, or for the effects thereof.

I can research it but what city is it in? There are Northlawn streets everywhere?