This happens, for example, when someone who is about to declare bankruptcy starts liquidating in an attempt to shield assets.

But speculative purchases have sent many investors into foreclosure and bankruptcy...most recently during the 2008 real estate correction. 

The Qualified Trust Account is the most important so that if IPX1031 would end up in bankruptcy for any reason the funds would be considered client trust funds and not corporate funds like they were in the LandAm 1031 bankruptcy case. 

I live comfortably off my rental income, but I am the only young widow I know that did not end up in bankruptcy and foreclosure. 

My credit is shot for now, and I have been slowly repairing it and paying things off, but no bankruptcies.

With higher returns come a risk of default or bankruptcy.

., or do you need to set up strict rules in advance for the credit report (i.e. up to $500 unpaid medical bills allowed, no bankruptcies, no child support in arrears) and not deviate from that?

That's how it started and by making contacts with estate attorneys, bankruptcies and government services we would be contacted about purchasing obligations.I also did a few seminars for Realtors and would meet with attorneys, CPAs and Stock Brokers building relationships with them.

Files for bankruptcy?

Also, if the seller ever files a bankruptcy, you want to be notified so you can claim your property.