I wouldn't be surprised if you decide to look for lower hanging fruit before venturing off to court-confirmed sale, though.

You have 3 baskets of renters instead of just one.

This probably is why the family is selling with the tenant still in there.You have to look at TIME to close this deal and the RETURN and see if more sweeter low hanging fruit is available elsewhere.

Over the years we have looked at this type of buying and felt it would have too many eggs in one basket or neighborhood so bought in different areas so if one area was down other areas could carry the load and all the bills could still get paid.

Let someone else work for free and you purchase the fruit of their labor.- Risk: large projects often over run. 

making it less than fruitful for the average person to play!

We found one lender that will do 80% LTV, but I don't really want to put all our eggs in one basket by relying on that lender exclusively.

I wouldn't put all your eggs in one basket.  

If you do this and maintain a big picture mentally, your partnerships will be fruitful. 

Accurately describes a (typically) long-term approach to clever investment in real estate, focusing on good cash flow, combined with a non-real estate investment strategy (= never put all your eggs in one basket = diversification), while at the same time already picturing a clever (i.e. primarily "tax cheap") exit strategy for the investment properties.