When the property is sold they will actually have a loss to report because they take the value of the property on the date of the owner's death and can subtract commission, closing costs, etc. 

Due to being transparent the seller called me 4 months after our initial conversation and stated although they will be taking a huge loss they just need to sell it and move on.

Often the lender takes a financial loss too. 

Passive income can be offset with passive losses.

Drop the hammer now and cut your losses as fast as possible or the bleeding will continue, otherwise hang on for a wild ride and it won't be fun.  

Profit loss sheet ?

I'm just at a bit of a loss regarding how to best do it... particularly when it comes to financing it.

@GreatTen TeamThe first thing you should ask for is the P&L (profit and loss statement) for the past few years at a minimum. 

You can cause a seller a financial loss, this is a "Tort" look that up and study what "tortious conduct" is.This is just part of the unethical side of wholesaling when offers are made by those who don't have the ability or intent to buy as agreed and disguising their true intent. 

Or are you at a loss annually?