Why do we not here of these pitfalls when all are recommended to go over-sophisticate the ownership of residential property.  

Sophisticated investors invest on cashflow where the rents exceed the mortgage plus expenses (and enough money to pay for professional property manage to do our dirty work).Sophisticated investors look at the Rent-to-Value Ratio and look for at least 1% or more to be able to cashflow after expenses.

I have been watching and researching Hubzu for many months and what I found is that Hubzu has a sophisticated calculation to determine reserve and opening bid based on prior bids, BPO as well as a WAG.Also each property has a local agent/broker associated with it and it looks like the agent/broker can over-ride any number presented by Hubzu.What I do is determine a fair price (ARV) for the property.

@oren H something you said in the question makes me believe that you are a more sophisticated insurance buyer some just look for savins and can care less about the coverage some truly understand the risk and then look to get the coverage.

It is ironic but true that it's often easier getting a larger deal done than a small one due to the sophistication of the parties involved.

If you're not an Accredited Investor, you may want to ask the syndicators you're interested in working with if they accept Sophisticated Investors. 

When I was working for a fortune 200 company selling very sophisticated computers to Hanford, Boeing and the military I had a co-worker who was a reserve Marine officer.

If you want to add “bells and whistles” you can link other services like mail chimp.I now use realnex, it’s twice as expensive but much more sophisticated for commercial offerings, email marketing and team cooperation.

It makes the syndicator look sophisticated and caring.

Our fund is a 506(b) which allows for up to 35 sophisticated (non accredited) investors a 506(c) does not allow non accredited.