Buying out of state: Would you ever forego an inspection?

[Daniel Hyman]

We had an offer to purchase a triplex in Indiana. The seller seemed forthcoming about the potential rehab needs (chimney work, siding, a few windows). We estimated 10-15k based on the seller's description. However, the inspection report showed a different story. Plumbing issues, electrical issues, roof damage, foundation issues, infestation, etc. 

I have heard that investors often do deals without inspections, even when purchasing out of state. If we hadn't ordered an inspection, my partner and I would be in a world of hurt right now. Sure, it's $400 down the drain. But I'll take that hit any day over a money pit.

When does it make sense to forego an inspection?