This was a reverse short sale listed at 47kBeing on my way to California and a little research I wasn't comfortable at that price point so I offered 40 thinking I had a buyer my buyer backed out the agent is waiting for an email from me so I am here trying to find out what to do should I go ahead with the offer.and hope to find a buyer or let this one go.

I like to tell sellers everything I plan on doing so they feel comfortable in the situation, it's building rapport 

I begin investing in Tax Liens approximately two weeks ago.I felt the timing was right and since I had some disposable income, I jump head first.I am still relatively new to the area and invited a fellow business colleague to assist me with accessing some of the areas; well a partnership was born.Although, we are both novices in Tax Liens, I have a solid background in researching topics (mostly taxation) but I digress so I felt mildly comfortable with this sudden turn of events.Well in hindsight, my partner and I management style is vastly different; this is where the slight nuisances started to appear. 

Find what type makes you comfortable and commit to it.

But if you're comfortable paying that (which it sounds like you are if you're looking at a hard money lender) then I would work with the mortgage lender you mentioned would work with you.

It appears the tenant has a disability and so the dog really is a service dog and not one of those comfort dogs. 

If we see a deal offering 20%, we have to get comfortable that there is a 20% chance that we will lose money.

Based on our anticipated offer being approved our numbers will work for us where we are comfortable, however, there are a few outstanding expenses that we foresee (prior to our legitimate inspection).

After you you get a rough idea for not only how much you are pre-qualified for, but more importantly what you feel comfortable spending you then want to get a feel for your market and the type of purchase prices you can expect for the type of properties you want to look to purchase.

Investing is the passive side where you should be evaluating how to use your money and maximizing roi, depending on risk tolerance of course.