I am currently in the process of purchasing a Duplex with an FHA 203k limited loan. I am house hacking the property, and I am less than two weeks out from the closing date. When purchasing the property I decided to use the listing agent as a dual agent in the hopes of getting a better deal. I have gotten all of my bids in and I am at the top of my rehab budget in regards to the loan. Everything had seemed to be in order with the house. Until today... I was allowed to enter the property to take some photos for my rental listing. When I got walked through the dining room I noticed a LARGE water stain that had not been there previously. I would like to note that when I did my initial walk through I did notice that the seller had recently painted the ceilings, but didn't think much of it at the time... Well, after investigating, there are some drawers recessed into the wall on the second floor that I was able to remove and look behind the wall. That is when I found a very prominent leak in the roof. Not only was the roof leaking, but there were trash barrel lids under the spot that was leaking, apparently in the hopes of catching the water.

My question is how do I handle this? It was never listed as a disclosed item. I had explicitly asked about the age and health of the roof, and I was told that it was fully replaced 9 years ago and in good condition. To be fair, from the outside you can't tell that there is anything wrong. Do I have any recourse here? I was thinking about getting cash back at close. I'm not sure how much yet, since there is a fair amount of work to be done to the roof and fixing all of the water damage. Also, I am not even sure that this is allowed with the 203k loan... Do I ask for more than it will cost to fix incase there is more damage than I can see currently, holding costs, etc...?? Any advice/opinions are more than appreciated!

I have attached the picture of the lids as well.

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