Here is what the State of CO says about these PREDATORS:Consumer Advisory: Long-term Home Ownership Concerns(Wholesaling/Assigning Transactions and Distressed Rescue Transactions).

Purchase price: $255,000 Cash invested: $100,000 Bought a distressed 5plex.

More flexible underwriting less restrictions.Can lend on distressed property. usually you can finance rehab costs plus purchase.Can have Higher ltv on non owner occupied than many other options.Experienced in financing flips and invesment properties, can help advise and double check a deal.

In some areas some properties will trade at very low caprate because of something unique like location type of construction etc. in some areas properties will trade at a higher cap rate for similar reasons, location, condition, distress etc. 

Purchase price: $117,500 Cash invested: $85,000 Sale price: $240,000Bought a 2 bed, 1 bath distressed house, seller carry 95% of the purchase price at 4% IO, rehab cost $85,000 including an addition of a master bedroom and a master bath about 300 sq ft of new living space.90% of the house is new, roof, siding, subfloor, windows, sheetrock and texture, electric, floor coverings, kitchen, Air conditioning unit, front porch, garage, paint, etc, etc.Very satisfied with this project, good numbers...ROI 35% Neighbors, and city inspector are happy as well.

What are some good sources online for deals (distressed/motivated)?

I've been driving for dollars and making a list of distressed houses in my area.

Time is money (someone is facing foreclosure, bk, etc), so you should be picking up this distressed property for significantly less than what it would get after 2 weeks of open houses and exposure to the MLS and a week of back-and-forth and then another month it'll take for someone to secure financing. 

Account ClosedTrue that.... this is wholesaling on another level especially with the Silicon Valley VC funds.Not all hope is lost for mom and pop though since their criteria is pretty stringent to certain markets, a specific type of property and a light rehab.... appx $7,500.00 +/- it seems from the examples I have seen so far from Zillow where they have put the rehab numbers out.Whatever does not fit the Zillow funnel and especially properties needing heavy rehabs will still be out there for mom and pop operations.....your typical distressed house needing more than paint and carpet essentially.

In addition, if you are buying a deeply distressed property it can often be challenging to make the numbers work.