The landlord has a reasonable time after notification to repair the defect or damage alleged by the tenant (repairs must be made with “diligence and without culpable delay” (Section 9-14.2(a)(5)); more than 30 days is presumed unreasonable) and upon completion of the repairs, must notify the tenant or the Department of Housing and Community Development in writing (Section 9-14.2(c)). - See more at: http://www.peoples-law.org/special-laws-rules-balt...Also...... " Landlord may not evict tenant, increase the rent, or decrease any services to which tenant is entitled for any of the following reasons (Section 9-10(a)):Solely because tenant complained in good faith to the landlord or to a public agency concerning the tenant's rights or concerning a housing deficiency;Solely because tenant is a member of a tenants' organization;Solely because tenant filed suit against the landlord; orSolely because tenant consulted a lawyer on a matter involving the tenant's rights.

That is in part driven by Colorado's construction defects laws.

If the seller and/or listing agent are being dishonest about obvious defects, I'd be concerned with any repair being made by the seller.

My question is, even if they are able to get this defect cleared up do you think that I should simply stay away from this contract and move on to something less troublesome?

(rust belt) and not Canada  (short sales simply do not happen here for a variety of reasons ... perhaps fodder for another thread).Another BP member has already walked this property and based on the resultant list of observations/defects, I have an acquisition price range in-mind.  

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).

So, if something were to happen at 6 months, at the move-out it would be caught because the move-in also shows defects. 

The current owner did a rehab and when I did the walk through with my agent it looked immaculate and the seller's disclosure form looked great with no defects.

If you agree on a price, and its not a phiranna feeding frency, you get it for a fair price, transfer the servicing, and have the collateral files sent to a company that scrubs them for defects, records anything that needs recording, creates anything missing, and stores them for you. 

That is all it means.It sounds as though your due diligence provided a little better look into the potential title defect than that of the trustee.