Cindy, The most direct answer to your question is Yes, it could be a health hazard, and Yes, the Bank can sell it to you as is, with it being your responsibility to bring the property into a safe operational condition again. Prior to my retirement from government I served as the State of Ohio Superintendent of Real Estate, and in 1993 created a bill called the seller disclosure. This where the seller must disclose any material defects of the property. That primarily comes into play when the transaction is at arms length, or a normal person to person sale. When a bank however, takes over a property, that institution may not be aware of the historical material defects of a property, and almost always sales the property in an "As Is" condition. Simply put, the buyer will assume all of the risk of disclose (visible in the five foot of water situation), or hidden defects. It becomes a contractual agreement that you can accept, or reject. So consider this when making the purchase of a foreclosed property. Also, consider that cities such as Shaker Heights, Cleveland Hts, and so many others, aggressively enforce housing actions on these types of properties. Best thing to do is hire a very high quality contractor, who can come in and share with you all of the potential defects, the corrective activity that will have to be completed, with the cost. Inspection of such a huge purchase should not be a cost cutting option. The bottom line to keep in mind, is that the buyer must always be aware. The bank, primarily, offers you financial option to pay over time, if you cannot make a cash offer on a property. Of course, there is so much more to property procurement, so consult an legal council. After that, the decision is yours.