That would determine whether or not you're low-balling the guy.  

The lending institution will look at the numbers on the property to determine if it is a good investment.Run the numbers to see if they make sense.

Generally, the rule for every state will be this: Your contract will determine what the rules are unless it is contrary to state law in which case state law will always hold. 

Check the classifieds, internet postings, driving around, dealers, local repo people and let them know you are looking for a home.

I am disappointed, but I will keep trying - I am determined to find a great first deal!

Then hit the internet websites and see if there are any recent sales to estimate current market value.

Reason this seems important is that it would help determine strategy of a larger vs. smaller downpayment to increase cash flow or increase leverage. 2nd Question) I've read about "special allocation" of taxes that allows for the tax gains/losses to be distributed in a manner that is not equal to the ownership stake.

I've found that www.listsource.com allows you to search by zip code, equity %, corporate owned, etc and from there you can determine who is actively buying properties in your market.

Besides that, comps of other properties sold that are similar and CAP rate will help determine if the sales price is in line with the market. 

@John BlytheYou are way ahead of the curve already by asking this question on BP.I stared with $500.00 in the 1990s and began buying unwanted rural vacant land and selling it on the internet for twice what I paid (each deal).