I have a reputation for being able to actually close deals, as opposed to the multitude of newbies during the boom who were good at talking and bad at closing.

Open a checking account...then go out and look for a house.My point is not only will you get an updated education on REO, you'll make a friend out of your own banker (never a bad idea), and a great home-buyer referral source.Good Luck!

That, to me, sounds like a bad accident waiting to happen.

Legal expense in dealing with damage and bad tenants.

Building on what Wheatie said, using your more specific financing assumptions ($5K down, 6.3%, 30 years), along with the 50% rule, you get the following:Gross rent: $470Expense percent: 50%Expenses: $235NOI:$235Payment: $209Cash flow: $31+/monthSo, that's $369/year cash flow, which at least is positive in terms of pure cash flow, but let's calculate the returns:Cash-on-Cash: $369/$5000 = 7.38%Total Return (w/equity accrual) = 15.04%So, not a great return, but maybe not as bad as was originally portrayed; keep in mind that this doesn't include closing costs, which would reduce your return by a percent or two).

Maybe they want the house bad enough to deal with it.

If the news is bad, you want specifics before it costs you anything.

I have yet to have a seller balk at my upon partners approval clause.They tend to understand that you are running a business.If you wholesale and wholesale only and have no money to purchase the house, you will need a couple of outs just incase things go bad.Obviously you are not in business for things to go bad, but we all make mistakes, houses wont sell, etc.I have and probably will always use these clauses.Not to sound mean, but many distressed sellers will not even care about these clauses, they will just want the cash

Rather confusing how a deal can go from good to bad, without any of the factors changing.

Pay $80-100K and this isn't such a bad deal.