We did take a step back on original price as now the inspection reports showed some serious deficiency with electrical panels that were recalled..

Down payments, fees, holding costs, it's not a cheap game and liquidity is one of the biggest deficiencies among new investors. 

Some contracts have other language….must be a certain amount of repairs, seller has right to correct deficiencies, etc.

They most likely would rather have them sold and work out a deficiency with you than take them back and try and sell them.

@Benjamin Galetti thing is the listing said there was a new roof and when the inspector came back and said no deficiencies were found on the roof I had no reason to second guess until the GC said there were multiple spots on the roof that needed immediate addressing.

It recently took me 3 years - YES 3 YEARS-  to get them to do a new valuation, but then they ultimately approved my short sale and it closed.It does sound like he's been milking it, but ultimately he's better served by a sale than a foreclosure, especially if this is a deficiency state.

I don't have an inspection report, but one of the quotes has what looks like a diagram that provides a summary of the deficiencies. 

How likely is a bank to do a Deed in Lieu of Foreclosure as opposed to foreclosure and deficiency judgment?

Project was complicated and involved having to work through disclosure issues and contractor deficiency.

It has been 19 months past maturity and the deficiency amount he owes me is $190K and growing.