Be careful, there are a lot of people buying these certificates on the internet and they show you a fake piece of paper in hopes you allow the pet without add rent or deposit even if you have a no-pet restriction. 

Doesn't seem like it's a great "hold" on the short term but I do think it would appreciate and would increase in cashflow with how you described it and the layout.

Layout and Amenities look enticing!  

Cut out stumpDriveway - I'd clean up the driveway- not sure if it needs only sweeping hard to tell with grass in the driveway-First appearances matter.Front porch and front porch covering- not sure what that is on top but power wash.Living room- Carpet or depending on what floors look like underneath- If wood I would leave wood depending on condition, if not wood carpet- Strip wall paper off walls and nuetral paint- Not sure about the panel.Kitchen- I'd concentrate most of my money here- Tile the floors or if nice wood in the living room then I'd just extend the wood floors into kitchen.

End game: staggered sell-off of free and clear property and taking back the paper.

We signed the remaining papers at the title company and will fund the remaining balance once the seller gets an affidavit (because the owner died and the house passed up to his parents).

The buyer the bank and the secondary buyer can push papers and approvals around all day long, but without a binding agreement with the seller (which can't be had without terminating the original agreement FIRST), there is no legally binding agreement between the seller and the secondary buyer.And as a seller (or listing agent) I would never terminate a contract with a buyer on the hope the bank will approve a different offer, especially if I've spent weeks/months working with the bank on that offer.

I've been searching the paper and craigslist and I've found a few units that are fully occupied and generating 1500-3000 per month... why in the world would anyone sell something that is making money consistently?

Generally, either the record owner or legally empowered, person-in-charge is the one who files moving papers for eviction to get rid of squatters and other problem people. 

If the tenant was the director of nursing at a local hospital , she would be fairly easy to serve papers .