The borrower must have a legitimate excuse for falling behind… The inability to pay the mortgage, the loss of a job, death in the family or an illness would be an acceptable reason to fall behind on your Mortgage temporarily.A big key to getting Loss Mitigation to accept a hardship is to submit a strong hardship letter.

We haven't closed any of the previously 'rejected' offers but as a formality it seems to maybe 'legitimize' the offer, as they now have it in writing. 

I don't want to undermine the problems you mentioned in your post, because they are legitimate issues that people are dealing with everyday, but they really just are obstacles.

A smart agent would refuse, UNLESS they BELIEVE you are a legitimate Buyer, who offers them the ability to earn money.

But, it is getting harder and harder to tell who is legitimate and who is following a well scripted marketing plan to convince people to buy their product, system or program.

The basic "guru" pitch is that by buying training or resources from the guru, an inexperienced, uneducated (in real estate), and unknowledgeable investor lacking sufficient capital can become very successful in a certain area of real estate investing/business.The problem with most of these programs center around the following(1) The program taught doesn't actually work(2) The program does not provide the person purchasing the program with the knowledge, experience or education neccessary to successfully implement the program(3) The program contains very basic information that can be obtained far less expensively by other means(4) The trainers and consultants provided are inexperienced and/or incompetent(5) The program accepts anyone who can pay although many accepted don't have the neccessary personal tools to be successful(6) The program makes false and/or misleading promises(7) The program understates the amount of capital neccessary for success(8) The program understates the amount of time and effort neccessary for success(9) The program overstates the size of the target market(10) the program assumes that because of success in one market it will be successful everywhere all the time.There are legitimate real estate consultants/trainers out there with a track record of success.

Also, in the situation in this thread the squatters to moved in before the legitimate tenant moved out.

I would be willing to bet that "gurus" who don't actually do any deals at all make more money then legitimate wholesalers.

How does one run a legitimate business, pay appropriate business taxes, and come out with a zero sum to report on my personal 1040 and somehow protect the properties from being considered assets to be sold for tuition?

My take is that indeed no legitimate business uses these, at least those blind, insulting squeeze pages.