If not, are there tips you can share on how to judge how much life is left in your furnace/boiler or central air system?

I would at least notarize and record a Memorandum of Option.  

Just tell him it needs to be notarized, you'll have a witness, don't ask him if he's nuts!

The loan was secured by 2 properties in Chicago.In the closing documents, there's an Escrow Agreement which says the private lending mortgage broker acts as escrow agent for borrower and lender to hold said Quit Claim Deed: (Escrow agent = private lending mortgage broker) with the following terms1.Borrower agrees to deliver to Escrow Agent an executed and notarized Quit Claim Deed running to Lenders for the properties2.

They have a divorce decree, and notarized paper work saying they were not responsible for the payment since 2010. 

If not, are you just looking to gamble?

If not, are there similar strategies?

As long as they are properly filled out, make the proper claims and are signed and notarized they are no different than having the original note.In this case, the LNA is more of an instrument of ownership than the governance of the debt.  

If not, are you looking to be the guaranteed bidder? 

I have never doubled closed( actually once) on a REO, but the spread was over 50k.I have done it at the beginning if we knew the seller, we have done it once we found our end buyer, and we have even done it at the end when they are getting documents signed and notarized.