Well a lot of people have no idea that their boat is rotting out. Why would they even think that, if they take such good care of it and keep it so clean :noidea:

So, the seller may not have known, but maybe . . .
There have been many that have come before you that find out the boat they bought is a rotten tub. Many will fix the boat and make it better than new. $4K sounds a bit high to fix the boat DIY, but a bit low if you were to have it done by a shop.
The first thing to do is to see if you can determine the extent of the moisture penetration and the rot. If the transom is a gonner, then chances are the stringers are close behind, along with the main bulkhead.
After you have 3 posts, you can start to post pictures (we like pictures

) You can poke around the structure with a narrow screw driver or an ice pick and see if parts of the structure feel solid or poke through. You can also drill some test holes (1/4" drill) from inside the boat in other areas of the transom and in the stringers. Drill about 2" from the hull surface as that is where the moisture/rot will be. The drill shavings, whether they be dry, wet, mush, etc. will help tell the story. Once you have a sense of how much moisture/rot exists within the boat, then figure it is probably 2 or 3X as bad. :facepalm:
There are tons and tons of threads here on iBoats where people just like you have gone about fixing their nice new (to them) shiny boats and made them hole again. So, there is lots of information and experience to draw from.
The fact of the matter, is once you find that you have a rotted boat, you are really between a rock and a hard place. Can't really sell it and can't really use it.