I am thinking of buying a REO property and need some advice?

My mortgage is FHA, so I will need the house to p the inspection. There are some cosmetic issues, but nothing that I see to really be an issue. My realtor on the other hand, says that the house wont p! So how can I have the bank that owns the house possibly repair it to get it to p the FHA inspection ? The house has been vacant since 8/31/2010. It went on the market in October at 75000, they dropped the price 10000 in November, another 10000 in December, 5000 in January, and now its listed at 46500. I would think they would be motivated to get this house off their backs.. Plus once I do an inspection on the property and give them the inspection report, they are obligated to report the issues to any other potential buyers, correct? Please! Someone help me here!! I love this house, and I am willing to put the sweat equity into it, but first I need to get it financed!