I've had a few conversations with the owner and he's very motivated to sell.

@Don Carey in my area you can get them from the title companies - all sorts - very specific.

He is motivated to sell and his ex is ready to move forward as well.

I have a number of years before I will reach my own passive income goals that will allow for this type of freedom, but this search is one of the motivating factors pushing me to achieve those goals.   

Or should I just forget about even trying to evicting them, especially with kids I heard it can get messy (even though Paterson is said to be "sort-of" easy for eviction) and back-out of the deal, especially if the ceiling mess looks way worse than we thought (even though that was already considered a total gut-job) and since we put no deposit down, we technically have no loss (besides some damaged relationships w/ the broker)?

and continue paying for the mortgage on the first house whilst the second house sorts it self with rental.really what i am asking here is where does one live after their first investment purchase. do you rent somewhere else  and buy your first house for rental? 

Think of an option that hurts as a good motivator. 

The further risk to a bank's image/brand in being opportunistic in this regard I see as another motivating factor here.Examples welcome though! 

In the early 2000's, motivated by a philosophy of "Power to the people", Richard Barton founded co-founded Expedia, Zillow and Glassdoor.

Makes more work for your Tax person to go through and sort out the expenses that are your non deductible personal expenses which in turn= a higher tax prep bill for you.