Nearly $10k later for plumbing, plus more $ for access to plumbing, after all the plumbing was replaced in a 100 year old house (e.g. no access, lots of additions) all is well:)  But lesson learned, ask for dates of vacancy and date of Winterization, or look for the stickers in the house and ask the neighbors when the folks left.

They may come across an incredible deal they can't pass up or they may encounter a hardship that requires the money.

And...there never seems to be that same level of "fear" of default that a borrower or renter would encounter with an arms-length party.The parents should discuss the situation with their tax advisor.

How can investors avoid signing an exclusive agreement with a "dud" like the OP encountered?

@Dillon HutsellIt's by far and away the biggest life change you will encounter, but it will teach you a discipline that you take from your military life and incorporate into how you invest.

I don't think he's ever actually even seen the house, if he did I don't know how he could have missed the Holton-Wise stickers on the doors, windows, cabinets, furnaces, hot water tanks and electrical panels.

When I first encountered this I took it to mean that they kept that % no matter what as a tax "just because they can".

I currently have the money to start an Airbnb arbitrage business but now that I’m ready to get started I’ve encountered some hurdles pertaining to short term rental restrictions.

Rather, their job is to conduct a reasonably thorough canvassing of the property, given the time allotted and the obstacles they encountered. 

@Barry Pekin as a newbie I find that unfortnately people are in such a hurry to sell their products that they dont tell you the ramifications you may encounter.