Protect yourself with inspection periods, add value by dealing w squatters and or negotiating the lien balances down.

I am personally contemplating how much debt I am comfortable working with and trying to find a balancing point that I can feel very confident with

Every agent should know that in a loan mod, a portion of the principal is temporarily "put on the side", usually about a third, for the sole purpose of calculating a new lower payment (ie 2% interest, 40 year amortization) on the remaining lower balance.  

 (1960's build)The value is really all in the land, but there is this reverse mortgage hanging out there, and the balance exceeds what I would pay for the land.The good news is that the property is located in an enclave where major developer/investor tear down activity has been going on, with properties selling >$1mm, once developed.  

Mike made some excellent points.Also you will need to know when the note was created (date) and the last payment received from whoever sold you the note as well as the balance owed.

Is he/she unwilling to spend anything on his properties because he/she is out of balance and won't respond to basic human safety concerns?

Nothing upsets the delicate balance of multi-family living than when tenants find out that the folks in Apartment A pay $50 a month less than they do

Get in with as little out of pocket as possible and then take the balance and attempt a flip.

Interest caculated daily to an outstanding balance can cause different amounts, if interest is compounded and made a part of principal on a daily basis, your loan may not be in compliance for a residential property.Sounds you didn't get the type of loan you thought, I'd certainly investigate the note, your closing documents and especially the APR.

Having reviewed her credit report with her, she, in 26 years of credit history, had NEVER missed a payment and had ALWAYS paid more than the minimum on her balances.