You really must take much more care in a deal like this than if you were buying a house. 

You stopping by, letting them know the situation and making them aware that legally a different person can make the purchase and not care for their input or best interest. $200 below market if they never leave could be one of the best things to happen to you.

I'd be careful about how you inform the former tenant about it though.And lastly, but most importantly, the best thing you can do is get a better property manager.

Be careful about loaning someone money that you don’t know and who you “just met in a forum”.

It happens because the provider feels like they can demonstrate cash flow - but be careful because they can minimize certain expenses to make the cash flow look good, but then unexpected expenses could kill your profit.

For background, there is some termite damage on it,that should be taken care of prior to close, as well as some other minor fixes to the roof, basement, etc.I received a quote for the building for an After Cost Value (ACV) policy, which was about 40% of the Replacement Cost policy.  

I don’t want to try to sell it with tenants in it, because, as you know, no one takes care of your house like you do.

Actually, they dont even care once your original loan is approved and you are making all the payments. if you dont like an addendum, and you really want to buy this, pay the higher interest rate and refinance later. 

Remember the bank doesn't care they just want their payment and you need to be the same....

I have to be very careful about every move I do. otherwise I will be spitting into my own face, hahaha (a persian idiom).