If the LLC is not an option with the realtor business (eliminates S-Corp election option) then I don’t think it is worth setting something up for investment purposes assuming you don’t already have a large RE portfolio.As for your other question, for most of my business owner clients I recommend using Interactive Brokers because interest earned on just cash (not putting it in any financial instrument or security) earns a very competitive rate relative to the many alternatives.

So you would be able to maintain your credit score while a foreclosure is delayed or eliminated altogether.  

If you can get protection on the downside and you have to sell unexpectedly, then you can reduce or even eliminate your loss. 

Or is there a way to structure to eliminate any impact of the existing seller?

If you don't have much capital your best best is going to be house hacking a single family and eliminating your living expense.

To achieve this, you need a passive income that meets two requirements:Rents must outpace inflation: If rents do not outpace inflation, no matter how many properties you own, you cannot achieve financial freedom due to inflation continuously eroding purchasing power.Income persistence: Financial freedom requires that your income lasts throughout your life.Whether rents outpace inflation and how long the income lasts depends on the city where you invest.Start with an initial list of potential cities and then eliminate any city that does not meet additional criteria.

We just walk away thinking, well we just eliminated some of the competition today. 

Without knowing the specifics of (1) your personal situation and (2) the particular property market conditions for the property market your property is located in and (3) the condition of your house, etc. it’s impossible for anyone to provide meaningful advice concerning whether or not to entertain this offer.Many states have standard contracts and procedures which have all but eliminated the need for an attorney when the sale of real property is done utilizing the “usual” methods of financing and ownership transfer.  

If you were to rent it out and then do an exchange in the future you would be golden  same reason people do live in flips that they owner occupy for 2 years to eliminate the taxes instead of just deferring them like a 1031 does  To answer your original question. 

By paying the full amount due now to redeem, you might make things more difficult... the title company might be able to get the tax sale voided and eliminate a bunch of interest.