I'm no realtor but from my experience in the banking world, it's all in the contract. Make sure you read it carefully, if it is being sold "as is" as so many of these short sales & forclosed homes are, buyer beware. The bank is making itself not liable for the condition of the property. Your realtor should also be able to put in a clause as to the conditions of the home at the close of escrow.

Second thought is there has to be an appraisal done in order to get financing. The appraiser will usually note if he/she see's obvious damage. But that doesnt mean it will look the same once the tenants move out. Don't trust anyone on this, you will get burned!

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wishing wrote:
....so the bank is PAYING them to leave. Out of curiosity, does anyone know approximately how much banks pay a person to leave a house?

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It depends, from a few hundred to a few thousand. Generally the person being asked to leave will want at least enough to pay for security deposit and one month rent on their new place.

At this point, with the house in escrow, the current resident knows that the bank really wants them to go, so they'd probably hold out for top dollar.

But it's in the buyer's benefit in the end. Usually the tenant gets the money only after they've moved out and the agent has verified the condition of the home. If they make a mess leaving, they don't get the money. So the incentive is to leave the place in a reasonable shape.