We see a regular cycle in MD where it takes about three years before investors start to recognize their losses on the properties that don't redeem, and they are unable to make up losses through prperty sales.

In my opinion it's gambling and not investing.If you buy it and build on it or do something with it, then that's a different story.

If you are asking that question, either you aren't ready yet to start this type of endeavor or, you (or me admittedly) are missing something with your question.You can buy REO property from the bank with piggy bank money, drug money, gambling proceeds, mattress money, draw against your equity line, money found on the street that fell off the back of an armored truck, inheritance, gift from grandma, loan from uncle Billy or, from hard money. 

It’s a gamble but has paid off for me so far!

Basically I have limited info on the data and projections and cant truly nail down income until i list the property, which really feels like a gamble vs an investment.

If they have the ability to pay going forward and if I have confirmation from the rental assistance program that they have applied and appear on its face to qualify then I would look at it as a "gamble".

If you consistently analyze properties, it will be much easier to recognize a good deal when it shows up.

Sometimes we may see 5 homes at Sheriff Sale and want to bid on all 5 homes, the opening bid doesn't show up on the home right away and I find myself gambling on paying a Title company to do a search on all the homes and risk either them coming up to high for what we are willing to pay or possibly getting cancelled.

This is the plan that I get eager about, but it's also a big gamble in my opinion. 

Lesson learned, do my own research also so I can recognize incompetent "professionals", cost of lesson was13% ROI instead of what could of been 30+%.