Besides setting aside $400/unit, how much cash will a bank want me to have on hand or available? 

No one has lease agreements between the two and no money has changed hands the past couple months.The way I see it, is their "lease" is not valid and I could essentially evict as soon as I close on duplex (21st). 

I feel so bad for those that hand over money to these people.

Hey the appraiser in there, hand them some before pictures, and always print out a few comps you’d like them to use!

On the other hand I dont wanna buy a full price either.

Please click on the links, give them a read, and share your thoughts in the comments.First is a post that I feel will help not get overwhelmed with the amount of info that is here on BP:https://www.biggerpockets.com/blogs/5868/52761-the-simple-guide-to-getting-started-on-bp The second is a post that will help get you focused with your real estate investing goals:https://www.biggerpockets.com/blogs/5868/52743-im-new-to-bp-any-advice-would-be-appriciatedThe last one is a post that will help you choose an “investor friendly” real estate agent.

Sounds like you bought a house, with taxes paid up for the quarter already and you took possession sometime during the quarter. it also sounds like they forgot to calculate the tax credit due to the seller at closing. if that's the case, I believe most purchase contracts have a clause that states you will make it right if there was some miscalculation or simple omission at closing. even if not, the old owner paid for taxes and you are benefitting unjustly. the ethical thing in my mind is to refund the extra tax. there is no reason to go to court for this.if i'm wrong, please explain the situation better.

On the other hand having a draw schedule and fund control with inspections before disbursements could be good if you're new to this as it could keep your contractors in line and it will force you to collect all the necessary paperwork in terms of Certificates of Insurance and W9's.

Highly recommend getting on the phone and seeing how you can lend a hand (connect buyers and sellers, educate owners on CASH program, educate on tax deferral methods, etc.)

This is hands on experience that you will leverage in any future RE investments.In San Diego with low money down, the property (purchased at retail) is going to be cash flow negative at purchase.