This is a completely unknown scenario to me and I am wondering if anyone can give me advice on what to consider, request, research, advantages, disadvantages, risks, risk mitigation, required/recommended paperwork, etc.Thanks!

@Matthew Maggy you want to reduce your exposure to loss and your unknowns. $2K for gutters is the way to do this.

I would hate to purchase a tax deed and find out that there are back taxes, or its inhabitable, and other unknowns that will eat up my start up money.  

As a CPA looking at these numbers that appear to be annualized, there is not enough cash flow buffer for the unknowns.  

Today, when I returned to one of my rental properties that I purchased two months ago, six unknown people were gathered around my property. 

That is what I am trying to tell you and for some unknown reason you are having trouble understanding. 

In our experience they had a high unknown reserve.

It's usually telling if the seller will not hold a second that they want to cut the chord completely.The second if you wanted to reduce the payment get it interest only for maximum cash flow while you are dealing with unknowns on the property.I would want to know about the water and sewer rates per gallon.

Problem is, you have no legal right to enter the property until until after the full amount of the bid is paid, and this risk of 'potential unknowns' makes getting even hard money virtually impossible, no matter how good the deal is.I always allow for an absolute maximum cost total rehab in my figures on any property I bid on (and always check the property externally), and there's still plenty of 'meat on the bone'.

I think you can find deals in most markets, and leveraging family, friends, or existing real estate contacts will yield much better returns on your time and you'll likely have much higher confidence in the results vs. starting with strangers in an unknown market.