It'll become my problem, never mind if the assessor shows up, hikes the taxes, and god forbid it hasnt been done to code.

It looks like you are in OR given the area code for the phone number.

My understanding is that with any forgiven debt on a mortgage the seller should expect a 1099 from the lender.There is currently an effort to stop the issuance of 1099 for forgiven debt in hardship cases in congress but who knows where that will go it requires a change to the tax codes.

When its a code item, I study the county code books.

Depending on local code, and the extent of work you are doing overall, you probably have limited options.

But, here we have the city shutoff right at the meter typically down near the sidewalk/street and then a shutoff right where the water main comes into the house.In my area it is code to have the water meter in the house isolated with gate or ball valves Usually the valve before the meter has a lock out on it that only the water dept. can open or some sort of tamper seal to prevent people from by-passing their water meter.

If the property has zoning or building code issues a loan or insurance can be a problem.The commercial zoning could drive up the value if someone wants the building or even just the location.

I am guessing nobody wants to give an answer that could have life altering consequences for you :DHowever your last comment sorta answered your own question.

You can make more money by focusing on RE deals than by learning the tax code.

Other lending transactions are covered by banking laws, loan companies, pawn shops, securities law, with additional lending and collateralization as well as collections falling under the Uniform Commercial Code, Fair Trade/Collections and a hoast of other regulations.