Property w notice of trustee sales & 3 previous buyers w issues to get deposit back

[Daniel Loane]

Hi Biggerpockets!

My wife and I are looking into a SFH in Los Angeles County (incorporated) and found a house we both really like. We are generally quite new to owning real estate but own 2 out-of-state rentals in Ohio.

We found out some concerning details about the property & feel like there is some friction with the seller (FSBO), so were hoping for ideas/pointers on what would be a smart strategy to proceed given where we are:

Details:

- The property has a NOD and a notice of trustee sale with a foreclosure auction scheduled in ~1 month

- The house was on and off the market since April. It only went pending once officially but there are multiple hints that more buyers were initiating escrow

- A lis pendens was put on the property a few weeks ago. We tried to get ahold of the people and found out that they were prospective buyers who told us that the seller wouldn't reimburse them their deposit (despite an inspection contingency). They mentioned that two other buyers supposedly have the same problem with the seller from what they heard

- They mentioned that there was one big issue with the property. They weren't willing to share it with us because they didn't want to limit the sellers chances to sell the house. They did recommend to hire a good agent and to get inspections, talk to the city. They mentioned talk to the city twice, so we felt like there maybe was a permit issue but the permits we found online didn't look like an issue. We brought a family friend to the house who used to work as a contractor - he didn't anything concerning during his inspection (but he's not an inspector).

- The seller has inspection reports but aren't willing to share them up until our offer is accepted. They claim they'd be willing to share them after

- On the side, seller is lying about many things like lockbox codes that would be automatically changing, many people having seen the property when we have various signs nobody was in there. 2 neighbors warned us to be careful with these sellers because they seem shady to them

Some questions crossing our minds:

- (1) What's a good way to get ahold of permits and 'talk to the city'? I tried calling with a code engineer of the city last week, will try again this week. Are code engineers the best path here or should we bring good attorneys into the loop?

- (2) We don't want to put down a deposit at this point given that the risk seems to be too high to not get it back. Are there any creative ideas how to avoid it? Just write an offer with 0$ deposit being honest about what we know? Get our inspections lined up prior to writing the offer with the risk that the money is gone and another offer is taken up earlier?

- (3) How difficult is it to push the foreclosure auction for the seller to a later time if they find a qualified buyer? 

- (4) Any other ideas?

Would appreciate any help! Thanks!