My wife had an electrician in the house 10+ years ago and thought he was removing the old knob and tube wiring as part of the overall system upgrade to 200 amp service. An electrician there yesterday (to fix a light switch) discovered that the knob and tube wiring is still active in some of the lighting fixtures and switches.
We accepted a lowball offer on the house sale on the condition that the buyer not ask for any repairs to be made (or concessions provided in lieu of repairs). The buyer said "yes" but still wants to do a home inspection (which I have no problem with). We disclosed no knowledge of active knob and tube because that's what we thought the situation was.
I'm fine with our agent disclosing the new information to the buyer's agent. But I'm concerned that the buyer may say that we have to fix it, regardless of the "no repairs" agreement. My electrician said it would probably run about $7,000 just to replace the wiring, then another $1,000-3,000 to repair the walls, ceilings, and floors that would need to be opened up.
The offer on the table is already quite close to the bottom line number we can afford to take. I could see tossing a few thousand dollars (at most) to the buyer but not the total cost to remediate. I don't want to lose the deal, however. Any ideas on the best way to handle this? TIA.