I had this 4-plex under contract with a combination of FHA loan and seller financing at a price that i thought was a good deal. The property is located in an ideal location where there is a high demand for renting. Last week, I had it professionally inspected and found out there are major defects with the roof, electrical and HVAC. There are also some safety hazards due to poorly planned structures. Although it's easily rented out, i can feel an impending breakdown that would cost more than $50000 to repair down the road which would eat up all the cashflow and reserves and may even put me into a financial pit. The seller is an old man who owned the property for the past twenty years and wants to sell the property off before that day comes when he would be responsible for fixing up the issues. I didn't feel at ease with taking over the property so I decided to cancel the contract. I'm feeling a little deflated after having gone through all the work to find this property and analyze it and get it under contract after negotiating for a few months.
Negotiate with the seller by discussing the needed repairs to come to a fair compromise to make the bad deal a fair deal.
No deal beats a bad deal every time! Also, are you sure your lender could fund an FHA loan with an owner carry second?
Looks like a DOA dead. If the deal does not make sense, move on