But it will need a LOT of work, insulation, updated wiring, new roof, heating system, and potentially a foundation.

It's got a flat roof that I haven't seen replaced in the past decade. 

Can you imagine going into a gas station with a sign out front saying gas was $2.59 a gallon, and when you went to pump the gas you first had to pay a $15.00 fee for using their pump, an $8.00 "lot fee" for parking you car in front of their pumps on their property, a $17.00 "roof" fee because there is an awning over the pumps, and a  $14.00 "snack bar" fee to cover the fact that should you feel the need for a cool refreshing beverage, you have the option of walking in and purchasing an Icee for $1.99?

We got the inspection back today; the issues are as follows: mold beyond the surface mold we originally noticed when checking the house out, wood rot in left side floor, damaged roof joist, poor ventilation in the attic and mold, many of the chimney bricks are loose, standing water in crawlspace--potential mold, leaking shower and toilet leading to damaged floor/ceiling underneath, plumbing material issues, electrical not all properly grounded. 

After my inspection, I learned that there is significant damage with the roof, the chimney is in disrepair, the furnace and water heater are just at their life expectancy, and their were rodent droppings found in the upper unit furnace (inspector is guessing it is from the attic).

After my inspection, I learned that there is significant damage with the roof, the chimney is in disrepair, the furnace and water heater are just at their life expectancy, and their were rodent droppings found in the upper unit furnace (inspector is guessing it is from the attic).

This will be my first deal and my confidence is thru the roof.

Cap-ex is short for capital expenditures which is bigger things that will need to be replaced over time like the roof, furnace, appliances.

I agree the roof seems high.

PP $210kDP $15kRequired roof repair $15kInspection currently taking place this morning so unknown additional repair costsCurrent rents $2345 Owner paid W/S/G & exterior electric $544taxes $2200 /yrInsurance (awaiting accurate quote) estimated $1200/yrSeller financing $195k at 5.85% 5 year balloon amortized over 30 years with monthly payment of $1150.