But moving forward I will be sticking strictly with my guidelines.

Should I gamble on this or look into how to file a class action lawsuit against California's Judicial Council? 

Just jumping into a property is a bit more of a gamble.

It’s a risk, you need to decide if you are willing to take that gamble or not.

@Will McInerney What @Tim Swierczek said plus I'll add some of the larger institutions have really tightened their guidelines so if you are starting your search some of the medium-sized local banks and brokers (like Tim) are a great place to start.

One thing that would help better quantify if you are putting enough reserves aside is to follow the percentage guidelines. 5-15% for repairs and maintenance, 3-10% fr vacancy, and 5-10% for capex.

(Not requesting any offers/lendors/mentors/etc. per guidelines.   

That's a whole post in itself but just be aware of FHA guidelines.

In other words, will my bid automatically be accepted if it was the first bid and meets the monetary requirements and I am within the guidelines?

My section 8 inspector told me they have some wiggle room up or down but that the rental amount chart from the sec 8 office is a good guideline where to price your rent.