Confusion on something

[Shannon X.]

I'm a little confused on this and not sure how it works out.. and hopefully someone can help me out...

First, when you want to buy a house and someone owes (random number) 200,000 what is the most you can offer on such a house to buy and repair? (in flipping terms). I'm assuming you would have to flip the house for much more then what is owed, correct?

also, if their was a house and the owner owed the bank 100,000; then the bank takes it away from the owner due to the fact the owner was not making payments, is this 100,000 taken away then the bank has it in foreclosure and puts it up for lets say 150k? I may be confusing my self with the question but hopefully someone can enlighten me.

Thanks

[Tom S.]

I'll add my two cents on the first part of the question: How much someone owes on the house is somewhat irrelevant on what you offer for a fix and flip. It depends on what the house is worth. Then you work backwards for your offer price depending on the repairs needed.

If your offer turns out to be less than what the homeowner owes, that's the homeowners problem. Either they have to bring money to the table to sell the home, or enter into a short sale agreement with the lender.

- Tom