Rust hole in seat stay

Bought an old 531 bike off eBay last weekend. Switched the bars to some cruiser style ones today. It’s intended as a commuter and pub bike. So nothing fancy. Some rust here and there. Trouble is when converting it I spotted a small hole in one of the seat stays.

Reckon I’ll wrap it in tape to cover it. But will it actually collapse and kill me at some point? And I’d be crazy to ride it?

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Keep an eye on it, it won’t immediately break but even if it did nothing much would happen. The rear end might feel a bit floppy.

The rear doesn’t matter so much when something breaks. It’s the front end you need to worry about, when it takes your face out.

Weird spot for it to go in, not somewhere that moisture would be likely to sit so if it's gone there I'd be worried what it was like elsewhere.

Did someone just tried to drill a hole to hold a rack?

More importantly did the eBay seller mention this?

The seller hadn’t noticed. He’s offered to refund if an expert ‘condemns it’, and in same condition as I bought it (swapped out bars etc already) The hole was smaller when I spotted it. So touched it with a screwdriver, and basically crumbled. Am slightly concerned the whole stay will be like that under the paint. Annoying.

Considering selling as damaged goods/ parts. Maybe somebody else can fix as a project.

Refund, not worth it.

Who know if other area are affected too.