You might ask the water company to send you a letter explaining what type of activity would result in a bill that high- it might help you prove negligence or malice. 

The parties agree to indemnify the servicer and Freddie Mac for any and all loss resulting from an intentional misrepresentation or negligence made in the affidavit.

However, insurance is limited because it only protects you from one type of liability: accidents/negligence.

I feel he was negligent in sharing this information with us, as we would have approached this completely different, especially hearing this from 2 engineers.

I understand LT will not protect anyone from issues with negligence, but I feel it is worthwhile for my current needs in regards to asset protection. 

In the grand scheme of things, the money this contractor took from me is negligible, and the lesson I learned was very inexpensive for what it could have cost me.

Why the minus 180, it's so negligible.

@Ray OsFirst, I would be amazed if your insurance company didn't deny due to negligence.

And with all these deficiencies the show a cash flow of something like $500/month that in reality likely produces negligible cash flow when including cap expense and real maintenance numbers (I actually would never purchase a unit if I was projecting only $500/month cash flow a couple years after purchase). 

Ron, 1- I assume your lease has a clause that states "any damage to the property due to the tenant's negligence