Yes, you might not have been successful in winning the deal, but then again, you might have been!

If you are to have any involvement with this piece of real estate, you need to find out how it will be a win-win situation.

I applied for a mortgage loan through a local broker that was referred by my realtor and was instantly Pre-approved because I have pretty good credit.

I was able to buy the house with $30k instant equity, 5% down conventional 30 year mortgage and immediately get a $20k HELOC out of the new house, which I still use to this day to fund my investing.  

First, I alert them of the law upon winning the auction and I remind them of it when I sign the PA and a couple more times during the process.

Here are some great books that I have read and have provided some great insight not only in Real Estate, but also in life.Millionaire Real Estate Investor - Gary KellerRich Dad Poor Dad - Robert KiyosakiReal Estate Advantages – Sharon Lechter and Garrett SuttonThe ABCs of Real Estate Investing – Ken McElroyThink and Grow Rich – Napoleon HillThe Seven Habits of Highly Effective People – Stephen CoveyHow to Win Friends and Influence People – Dale CarnegieE-Myth by Michael E.

No win situation.What should he have done in your opinion?

It's a win win for all these different areas.  

In other instant, the tenant would just take off breaking the lease.

This is absolutely crazy since they are paying 400 to hopefully win the offer.