In regards to value, if this is a part of probate then at time of death value will need to be obtained with a formal appraisal.

How would you structure this agreement formally?

Bienes Raices, I'm in a non-judicial state and in an area of good employment, etc., so I am not too concerned about a second wave of foreclosures.

I would formally send a letter about the inadequate due diligence material as a cause to cancel the contract and refer to the clause in your contract about diligence material and the seller breaching it by lack of providing.

Owner Owes $85,000PITI is $794.00.Owner lives in another state and home is vacant.Our Strategy:[/b]RESIDENTIAL LEASE WITH OPTION TO PURCHASE AGREEMENT©I believe the RESIDENTIAL LEASE WITH OPTION TO PURCHASE AGREEMENT© is the Agreement used between ourselves and the SELLERRESIDENTIAL LEASE1) Rent: $ 800.00 per month (Based on current rents in the area)2) Lease Term: 12 months, beginning September 1, 2012 and ending September 1, 2013 .3) Maintenance: Buyer/Tenant will be responsible for maintenance and repairs of the property, not to exceed $200.00 per incident.OPTION to PURCHASE4) Purchase Price:$89,9895) Option Period: 36 months, beginning September 1, 2012 and ending September 1, 2015.6) Option Consideration: $10.00 All Option Consideration will be credited in full toward the purchase of the property.7) Rent Credit: Buyer/Tenant will be credited $400.00 per month toward the purchase.8) Closing Costs: Purchaser will pay all allowable closing costs.9) Expiration: This offer shall expire on August 9, 2012 at 12:00 midnight.10) Inspection: This offer is contingent upon physical inspection of property and subsequent completion of a formal and signed Residential Lease with Option to Purchase Agreement.MEMORANDUM OF OPTION to cloud titler Tenant/BuyerWith our Tenant/ Buyer we will use the following documents:OPTION TO PURCHASE AGREEMENT© which cannot be assigned.Purchase Price: $93,000Option consideration: @5% $4650.00Rent: $900.00Lease: 12 months, renewable x 3.RESIDENTIAL LEASE AGREEMENT© Unassignable.Your critical analysis of this deal is highly appreciated.

Another alternative would be to get yourself a buyer agent for this one specific property and have them submit a formal, written offer with a deposit, not just an e-mail with an outline.

Also in some states the foreclosure is a judicial process requiring the banks to go through the court.

You will have many more formalities to comply with.

Anyone have anything formal they can direct me to?

I rewrite it at least once or twice a year, but it's not nearly as formal anymore.