How Can I Close This Deal

[Roger Pokorny]

I am working on a lead and need some advice from the more experienced investors out there in the BP world.

Here's some background with numbers:

List price: $119,000

Specs:  2BD, 2BA, 1192 sq/ft

ARV: $125,000

Estimated repairs:  $28,000

MAO: $67,000

Offered:  $58,000

After making the offer, the listing agent informed me that the owners are an elderly couple who sold the property on contract to an individual who removed a wall between two bedrooms, turning a 3/2 into a 2/2 house.  Something happened and the house is now back with the elderly couple.  They are in assisted living.  I was told they owe about $90,000 on a mortgage.  They are in the process of trying to complete some of the repairs (replace the roof, etc.).  They offered a $5,000 repair allowance, which I waived and offered to pay all closing costs.

I would like to help this couple out and take this house off their hands, so they don't have to worry about a mortgage or any repairs.  With a $90,000 mortgage, I am trying to figure out how to pull this deal off.  There is no way the numbers will justify a $90,000 purchase price.  Are there any ideas on how to put this deal together?  I thought about negotiating with the bank to see if they will accept less than what is owed on the loan, but I am not sure how to begin that process. 

I am looking for any ideas from the more experienced investors on how to negotiate this deal and help this couple out.