Here I am putting down 25% of my money, have a great credit score of 780, have a job showing good income and yet they still want to see all my other financial documents.

I'm looking for someone who does good work at reasonable prices, shows up, and finishes the job. 

This simply isnt the case in the REO world.Also, a listing agent on an REO is acting much more akin to the job of a property manager as opposed to a traditional listing agent. 

If they balk, they don't get the job because I'm not going to eat their tax bill and I'm not playing patty-cake with the IRS.Keep smilin'Dennis

This does wonders for your cash on cash returns, and also your IRR. 

I am sure that I am not the first to have this idea so I am just wondering if people have been successful with this in the past or if it is not recommended.

$2500 in cash reserve is very small to me, you have personal mortgage and student loan to pay, if all goes wrong like lost a job or something, $2500 doesn't last a month.

So it was literally her job to be a perfect borrower, and she was.

Yes, jobs were lost but other jobs were created via adaptation and evolution. 

If you have water heaters exhausting up interior chimneys then be aware of possible leakage.Recognize that every job which you have to do has the potential to spiral into others- I have found a number of patchwork jobs when we went to do work that necessitated doing more work than anticipated.