That's reasonable.
Ask for a picture of the damage.
If you don't want to continue with the transaction, ask her for a Mutual Cancellation. She should then refund any money you have paid, and then send you the Request for an MC.
Agree immediately. This releases you both from the transaction, gives her selling fees back and both of you can leave feedback.
I'd suggest something like, 'Good communication that corrected a potential problem. Thanks.'