Each step you take reveals a new horizon.

I stumbled onto Bigger Pockets doing my do diligence on some real estate guru's programs, and found the comments on this site to be the most true, revealing, and insightful.

So if inspection reveals immediate 30k of repairs in the next year then deduct from say 247,200 to arrive at a 217,200 offer price.Many more variables and I can go on forever but this gives you the basics.

Inspection reports didn't reveal any major repairs.  

One bad tenant revealed I didn't have my renters license updated.

Or as you do a post mortem on how this "happened", you may see how some extra efforts or clues might have given you more information or even revealed some red flag.Bright side, this may be your worst tenant experience in your landlord career and you are already getting it out of the way....Best of luck.

Those items will reveal for the lender the ability of the borrower (and property) to have the income to service all debts of the borrower.  

Some of the things that came up: some black mold was revealed after kitchen demo, on the drywall where the kitchen meets the master bath.

It is totally unethical on top of that to reveal what should be kept confidential that creates such a disadvantage for the client. 

An inquiry to the city revealed it's a 2 Family.