Much like a home inspection, they try to uncover defects (e.g. setbacks, fences, aforementioned well, etc.), minimize potential risk & use the info to inform the buyer.  

Hello, I'm going to sell my property in King County WA. I'm doing some major repairs the house and planning to sell it in couple months. One thing I'm not sure about is the pipes. Since I'm going to sell it, just wond...

It appears as though the current owner was able to secure a conventional mortgage with a major bank with the title defect known. 

Also in Virginia definitely be up to speed on the Virginia condominium act which you have to warrant for two years against structural and habitat defects which typically the association hires an engineer to go through the building and create a punch list

The bigger issue is that you won't learn from the experience either, as you won't have first hand knowledge, see the defects, and be able to identify them in the future.

none the banks do not care about the proforma of the property only what they are owed and the appraised value They might discount for a material defect like mold or other issues 

All I can think of is disasters or defects with the property that I'd seek insurance against.

If the deal is that good, would a defect (even a $3k one) make you walk?

One or more professional inspectors should look for defects or malfunctions in the building’s structure, such as the roof, plumbing, or foundation, and detect pest infestations or dry rot and similar damage.

Somebody wanting to sue for you backing out of a bad deal or accusing you of selling them a property with defects like unknown termite damage).