REOs and conditions of houses

[Jeff M.]

Often when viewing REOs / foreclosures you come across rooms that look like below. And often we find scenes that look very familiar. Are these scenes indicative of the banks doing deep inspections on the property? Does this missing sheet rock imply a flood?

Are banks ripping out carpet because some pet totally destroyed it and it stinks to high heaven? But if so why are partial floors remaining?

So I am wondering if the community has an insight into most likely explanations for the history of how these homes got into such states...and half states. I desire a deeper understanding as to what likely happened to better estimate the overall condition of the property. Any ideas?