Buying a REO with squatters

[Damon Wallace]

I am curious if anyone has dealt with a similar situation and how to proceed. The property has been on the market for months. The exterior needs some work on the roof but otherwise looks pretty good. The status of the interior is unknown. I am curious if it makes more sense to completely avoid this home with the squatter situation or take advantage of the fact that the bank doesn't want to deal with it. On one hand I want to put in a low bid that assumes a complete gut rehab and on the other I am afraid of risking them doing more damage than I foresee. We considered sending them a letter with an offer to pay for relocation with an inspection, agreement not to damage and a successful close. Any advice for a fairly new investor?