Does the landlord have to directly observe the incident or be alerted from the actual victim?

The organization wants the property gone quickly and under the radar as it had a controversial incident which led to the closing of the "home" that operated on it.

What the person who told you about the "front and back" earning money thing was referring to something called "yield spread premium" - and that is illegal and no bank will use that fee since the penalty is a cool $1million per incident, per day.And what's really frustrating is that based on what you provided, the loan officer did nothing illegal. 

Just why is it after all this time you still have to clean this yourself. the carpet pad is rotted and there are lumps in the living room rug, rot has caused seams to come apart( was fixed with a left over piece from another apartment, does not match)have doubts about some incidents here which i cannot e=mention at this time)curious to see if there will be any replys....here in CALIF IT'S BEST TO KEEP YOUR MOUTH SHUT......JUST HAD TO SIGN A NEW RENTAL AGREEMENT EVEN THOUGH I DON'T LIKE SOME OF THE TERMS......WHAT I REALLY THINK IS NO ONE CARES....

After the first incident he told me he spoke to the tenant and the cops were called because she fainted in a store due to her medication and pregnancy... 

Trevor,Make sure to document everything, his first notification to you of the incident, picture of the steps, and picture LOS you took or any inspections you had performed on the property before closing etc... make sure that you have contacted your insurance company immediately, they will assign someone to your file and take care of everything from this point.

I would probably want to have some type of resolution on this incident prior to considering a purchase. 

The area seems to get a good amount of activity as far as crime incidents go. 

Document each incident well and take measures for your personal safety and that of the neighbors.

This has been the first incident like this with these folks.