I listen to his daily deal podcast because they are so much more authentic than anything else I've come across.  

My girlfriend's friend's husband has been gone for a couple of months due to his gambling addiction and has left her with the kids and the rent.

Hi @Devan Mcclish - I can suggest that being authentic and real is about the most important thing you can do.

This investor might be gambling that you miss the balloon date, he forecloses, he keeps the down payment, and he repeats.  

I don't like the lack of control and the entire thing strikes me as a legalized gambling operation where the house has their thumb on the wheel.  

This is a heck of a gamble.

For $50 a month, you are really taking a gamble on not getting the 3 showers a day tenant like @Colleen F. talks about.

Unfortunately you just have to pay it or walk away from the idea of getting clear title as you have no grounds to stand on in these situations as you ARE subject to the first mortgage at the least.It is a legal form of gambling and not for those that aren't prepared to lose everything they spend on these deals. 

Its a gamble but my thinking is I need to get the property for the lowest possible price and I never want the seller to accept my first offer because that tells me I offered too  much.   

This deal sounds too good to be true.You might be thinking "$500 isn't that much money, maybe worth the gamble".