Septic Issues, two days before closing

[Danielle Duffy]

This is a good one.
Two days out before closing.
Inspection period of 15 days or 5 days before closing is over.
Bank Application stated inspection of septic inspection & water test. Signed by Buyer.
Bank does not order septic inspection. (FHA/FL does not require)
Seller has tank pumped (hasn't been done in 5 years). Is informed by Septic Company that the fields are bad, water not pumping back into the tank, etc.
D-box not inspected.
Seller alters Seller Agent, Sellers Agent calls Buyers Agent.
$1200 credit agreed to.
Bank says, 'no room for credits, on the HUD-1, because Seller is already paying 'closing cost'.
Bank also says, because it's an FHA loan, if there is a problem with the septic FHA may not close the loan.

Thoughts?