Either the exhaust donut on the pipe is worn or the gasket at the head is leaking. Items#14 and 8 on the parts break down.Some 700s had the allen head bolts loosen up that caused leaking at this gasket. If that's the case replace the gasket and use loctite on the bolt threads.This will handle the rest of your questions. 2004 Polaris Sportsman 700 Service Manual PDF Download Also loosen the carb clamp at the intake manifold and check for any cracking. 700s were known for intakes splitting under the clamps and leaking. Cheaper aftermarket replacements are on ebay if ever needed.

Ok thanks do the efi have that same intake issue ?

Good looking 700,doesn't look abused. Efi models used a similar intake manifold,part numbers are different than on the carb model intake.

ok cool i will give it a look, yes it is pretty clean and for the price i could not pass it up, thanks

Is this efi or carb model?

Its EFI, i was quite suprised as i thought it would be carb but the guy i bought it from said its some special edition as it has the factory chrome rims

Then you need this manual,not the one I posted earlier.2004 Polaris Sportsman 700 EFI Service Manual PDF Download

thanks i saw the other manual in the listing from the first post i i ordered the EFI one!!

I can't recall seeing any ATVs with factory chrome rims but some had cast aluminum. If it came with chrome rims from the factory it really is special.