Assignment Question for a Pre-Foreclosure

Assignment Question for a Pre-Foreclosure

I have a question which I guess is kind of legal..I understand the concept of locking up a contract on a Pre-foreclosure at a discount; and then assigning that contract to an end buyer Investor for a profit*(assignment fee). My question is-If a Seller has gotten a sherrifs sale letter stating he owes $150,000 on his house;and it is due to be Foreclosed upon next month(For example)-how can I legally do a Purchase agreement for less? (Say-I offer him $100,000 with intention to sell the contract for $110,000 to an end buyer investor and my assgn fee profit is $10,000). How can this legally be done when the Orig Bank Loan is for $150,000-and they "technically" own the home since they havent been paid; and we just "bought" the property from underneath the bank; and "sold" it to an Investor. Do we need the banks approval for all this?-or what am I missing? Thanks everyone for their input.

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Short Sale

A short sale would be correct for this. Your comment about purchasing the property from underneath the bank can be done in the case of a subject to purchase or wrap around mortgage. However, this does not help you at all because the bank is owed more than the property is worth. Short sale would be about your only option. If you do a short sale the chances of getting an assignment of contract clause accepted would be small. In that case you would complete the short sale then use a double closing to sell the property to another investor.

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