@Brad Penley some suggestions I always try to get my client to take when buying a property that will require flood insurance due to your loan is, 1) make sure you understand if the property has ever had a flood, If so what year and how the water got in the structure and if the damage was repaired, also good to know how much the claim that was paid.

Mitigation also comes from being able to keep or use the security deposit for rent, but this is the absolute last resort especially if there is damages done to the place. 

You could also consider letting the boyfriend off the lease if there are no damages and rent is paid.

Account Closed  someone loses there job and you want to sue them .. give me an   a swear word break.. although in practice most board of realtors contracts state that the liquidated damages are limited to the deposit that was put up.. 

The lender is not damaged and presumably the owner was there long enough to satisfy the time requirement.Any *misrepresentation* on a bank loan, like intent, (reason for the loan), income, addresses lived at, rental history, amount of money in the bank, assets, liabilities, employment, time on the job, number of dependents, source of funds (the common things people lie about on applications that get them into trouble) etc, etc are potentially mortgage & wire fraud.

I have built the majority of my small portfolio by house hacking for the last five years, and one result of that is that I am now spooked by anything other than the low interest, 30-year fixed rate terms I've grown ac...

It's very common for a foreclosed home to be abandoned with serious damage to the interior.

BTW someone willing to pay rent above market rate is a high risk renter for some reason--felonies, past evictions, bankruptcy, poor credit, no or not enough income, or way toooo many people, or history of damage, professional scammer, etc.The landlord would not even be holding the lease to evict the folks you rent to, not have their deposit for damages, or any relationship with the tenants to recover damages in court as the tenants lease is with you.  

At what point does the damage become vandalism?

If the tenant caused $3,000 in damages and you don't have time to fix it up before closing, demand the Seller provide you the funds to make the improvements after closing.