New roof, furnace, drain line, eviction, major tenant damage, or any number of large, unpredictable expenses.

Sounds like the additional $3K is monetary damages in lieu of specific performance.

At this point we are desperate to find a reputable source that can help us with real information.

However, "tenant" (prior owner, or new occupant), has personal property damage.

To alleviate your fear, use a Purchase and Sales Agreement that states that your earnest money is full liquidated damages if you the buyer do not perform.

The investors who over leveraged their portfolio are the ones in deep trouble, can’t sell and are damaging their credit.

I can't speak to fungus but *every* property in California has termites, at least on the coast, so depending on part of the country and extent of damage, that's not necessarily a reason to run.

If you dont like the price but like the reputation, talk to them.

You may need to pay for $$$$ - eviction - clean up - lost rent - mental anguish - loss of local reputation LOAs are easier and cleaner for the Newbie.

Would that stick out like a sore thumb and severely damage our sale price if we leave that out?