Ultimately, if you have a lawsuit it is much more likely that your insurance will have to pay out a slip and fall or something like that. 

The risk to the buyer can be summed up as : violation of sue on sale can lead to note being accelerated:; assuming buyer is an investor and seller a homeowner the buyer will probably be named in a lawsuit should either the note be called or default occur.  

Most likely the state where the property is located is where lawsuits would be brought if they are something for personal injury like a trip and fall or something of that nature because the “cause of action” arose in that state.

Maybe you pay them for their trouble and to avoid the lawsuit.

I've use them for over 40 years, never been sued against the trust, and of the few law suits against the property manager we never lost one.

I also look for lawsuits and see what happened in them.

If you are asking a question like this you should really partner with an experienced wholesaler so that you can avoid lawsuits and problems for yourself, as well as for the seller, buyer, et al.

If I lump them into 1 LLC they would all be at risk in a lawsuit . 

It is my understanding that if you enter into the lease knowing of the foreclosure and placing a tenant anyway, then the lease is essentially deemed invalid as you and the tenant knew that it was a matter of time before they were evicted.Also there is an assignment of rents in residential mortgages as well, and doing this may open you up to a lawsuit by the mortgage holder since you essentially stole potential rent from them.And finally if the plan is actually to buy an HOA lien and wait until a foreclosure, I think that falls under unethical practices and would never do that, or encourage anyone else to either.

Would it all just be mostly the same: general background check (including prior evictions, lawsuits, etc), credit check, income verification, landlord references?