Follow through with this deal?

[Joseph Luce]

I'm really torn whether to continue with the deal now that I'm in escrow. Don't want to enter a deal that is too crazy to handle. I'm doing an out of state investment for buy and hold rentals.

This will be one of my first ever purchase. In a neighborhood where a new school was built, close to a monorail and new development is booming. The property will cashflow positive by $100 after vacancy and repairs but the important thing is that it will have 70k equity with my down payment of 20-30k After an estimated of 10-15k of repairs. Cash on cash return is roughly 4% but rents have been historically rising greatly in the past 8 years. The home is being bought at $90 a sqft while the rest of the homes are $120+ a sqft. Home is vacant.

However, the inspection report just came in and there are reports of water leaking that has been going on both on the roof and from the bathrooms. Possible mold was found but not 100% sure, will need to get a mold inspection done. The main issue is that the seller disclosure doesn't have any of this, and its visible by just walking around yourself.  This has me and my agent believe they are being dishonest. The owner has agreed to do the repairs but I don't believe they will do a good job.

Am I turning down a great deal or I could do better and find something else? I Ideally would like a home with some roof repairs, interior updates, and some landscaping as my first deal.

[Bob Okenwa]

If the seller and/or listing agent are being dishonest about obvious defects, I'd be concerned with any repair being made by the seller. I'd request that the repairs be made by a licensed and bonded contractor. There's no need to rush into a bad deal just to get a deal in your pocket. Some of the best deals are the ones you don't take. If you truly distrust the seller, make you have the property inspected again after the repairs/remediation is done and you and your agent can take it from there.