They should also do all of the management in-house and not use a third party.

Perhaps a nice 1950's built bungalow.Always hire a 3rd party property inspector to give you an unbiased feel for the home.

In the majority of cases, getting a lawyer in the mix is enough to scare the other party away.

Upon sale, both parties are then compensated accordingly.  

The earnest money should go to a neutral 3rd party.

I realize these are ofcourse simply just references and personal opinions of different parties..

This would be my first rental but I have done extensive research and have a friend who owns the same property, they are indivdual 4plex that are party of a condo community.

I remain sadly convinced that the reason most people don't want to do any handyman work as part of real estate investing is because they think they're above this work, not because they think they can't do it well or there's a sharply compelling reason for them to focus their efforts elsewhere.It's also the party line of every real estate guru out there that you should never do your own work.

Now we're told that this new seller has stepped into the place of the previous one, and wanted to proceed with our purchase contract.I would have thought that the seller's agent would have been obligated, when facing a foreclosure deadline, to seek a cash offer from us to stop the foreclosure first before bringing in a third party. 

Some of the disadvantages are generally lower LTV/LTCs, higher 3rd party fees, and additional legal review requirements and fees for LLC/partnership holdings.