I don't want to lose the deal.  

Being underwater means nothing and losing money each month means nothing if you have the means to service the debt.

Yes, BK does not transfer ownership, the bank still has on ore loses.  

So someone like me doesn't have much to lose, really.   

The banks are losing out big time these JV's and private investors are going to be bigger than banks if this keeps up

Obviously the lender could put contingencies on the POF letter, but then it totally loses its value. 

Tax liens and certificates can be a  mine field where you can lose all your money without some decent research.  

What are the pros/cons of the following:Owners home: FMV $200k, owes $130k, house is in decent shape.Owner loses job, can't afford to stay, going into foreclosure.I buy the house from him at what he owes and allow them to stay for 1 year NO CHARGE to them.13th month, the rent begins at $1k (FMV) per month.

Your on the right path and even breaking even or losing money isn't always a loss.

The biggest issue I find on a roof are old nails starting to work lose.