It may be as simple as a clogged aerator. 

This may be to deliberately prevent discovery of other electrical issues or prevent fire/injury.You will need some form of hard money or construction financing to purchase the property as is, and you will need to get the property occupant-ready to pass an appraisal before permanent financing is on the table.

My crime prevention class was canceled and I’m looking for an update on the rescheduled date.

.• That the deed is a device to clog a mortgagor's right of redemption.• Unfairness of the consideration.• Coercion, fraud, oppression, duress, and undue influence.• That the deed is not subsequent to the execution of the mortgage but contemporaneous with it.• That the grantor/mortgagor was insolvent at the time of the execution of the deed.An estoppel affidavit (executed and acknowledged by the grantor/mortgagor, attesting to the fairness of the transaction, the consideration exchanged, the value of the property, and other factors showing an intention to make a genuine transfer) or a recital (inserted directly in the deed) are supporting documents used to forestall challenges to these transactions.State law and local title standards must be consulted in regard to the consideration and treatment of deeds in lieu of foreclosure.What a GREAT post!   

This would also prevent me from using the HELOC for a different type of investment like BRRRR or fix and flip.

They will try to run 2 kitchens and that can mean clogged drains in your wet bar kitchen.Be sure there is personal recourse when you need to sue them for $40k in repairs above the deposit.

Quote from @Makan A Tabrizi: Quote from @Marcus Auerbach: We try to get ahead of the issue by preventing it in the first place.

To be transparent, there is not 100% full proof way of preventing fraud.

That means weekly on going preventative maintenance fixing small problems before they become big problems. 

Quote from @John Underwood: LOLI'm certain they will add restrictions to prevent people from doing this.