Typically on a foreclosure auction its cash-only, obvs, but since this was not a foreclosure and a state-owned property that has no leins, they couldn't give me an answer.Does anyone have any experience with this type of thing?

Being a condo less can go wrong but when a tenant moves out you will need to paint / replace carpets etc which a typical turnover is $1000-$1500.

Typically, borrowers must provide title insurance policies to protect the lenders' monetary interests.

There is definitely money to made in SS, and plenty of people are doing it.I'll also add to Mike's comments that small increases are easily attainable as (1) tenants typically aren't talking to each other about price (i.e. comparing their rent), etc and (2) most tenants don't find a small increase in price motivation enough to spend money on a moving truck and spend a weekend or more moving their belongings to a new facility.

In our 3 properties, we typically run a less than 5% vacancy, actually its less than 2%, but I always take 5% of the monthly rent for that emergency fund in case I run an eviction that lasts several months. 

Alternatively, you can try to get a private money loan or ask the seller to finance a portion to reduce the down payment, but typically equity is the preferred method when you need funds for a down payment.

Finding residents is a completely different process as compared to a typical rental property (assuming you are operating legally).

Best way is to get a payoff on the account which i typically do during the research and consultation stage with the client. 

Typically on short sales the IRS will issue a partial lien release.

The rental typically wont add much or any to your debt ratio, because its offset by the rents.