You blinked

Suddenly, the home owners are having a change of heart.  The list agent wondered if we would still be interested if they dropped the "as is" clause.  My agent told her that and the 500.00 repair limit.  I added that we would have to have remedy against them for disclosure issues.

Seems the owners want to know the house is going to someone who is going to love it as much as they did.  Hello, I am buying your house not adopting your child. 

I doubt they will agree to all my demands.  If they do, the deal is back on the table.  If they don't, deal is still dead.