I am sorry to hear about your situation.
You should contact an attorney to discuss your questions as additional information would be helpful. What does your contract say? Doesn't it say they have to give you possession? They can't do that if squatters are there so what are the sellers doing to get rid of them?
I wish you the best of luck.
Please remember that I do not normally monitor these questions after I have posted a reply.
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It is the responsibility of the seller & their agent to remove the squatters. If they had agreed to leave & signed papers to that effect the police should be called back in. Cintact your attorney & get him/her involved.
The advice I have given does not bind the parties in any manner and is merely given as a courtesy.
First, you should not try and buy a house without having an attorney represent you. If you already have an attorney ask him or her. If you do not, hire one immediately. Second, the contract should have a clause in it requiring that the premises be delivered to you vacant, unoccupied and broom clean. It should be the sellers responsibility to remove the squatters before closing. Again, if you are represented have your attorney review the contract for this clause. if not, get and attorney immediately and have him review the contract.
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The odds of getting the squatter out after you close and gave the Seller his or her money for the house are significantly less than they are as opposed to not closing until they are removed. Again, the Contract controls but it is unlikely that the Contract requires that you close subject to squatters.
What will you endure if you close with squatters? Great pain.