Buying a Property that Seller Acquired via a Subject to Deal via Charitable Corp.

[TJ Nowitzki]

Hi,

I have a deal I am looking into where the numbers make sense. The complication is that it looks like the seller acquired the property via a subject to deal.

1. 1. Property was going through foreclosure until subject to deal was done 2 years ago
2. 2. The property is now being foreclosed on again
3. 3. There is a combative tenant so financing is unlikely
4. 4. Mortgage is still in name of original owner but they did a grant deed to transfer title 2 years ago

My main issue is it looks like the "new" owner bought the property via a charitable corporation and then subsequently granted the property to their LLC (same person runs both). My main concern is the original seller getting screwed over or having been mislead.

If I don’t buy the property it will still go to a foreclosure auction (relatively soon) so I am still evaluating if I should come in with a cash offer and pay off all the liabilities.

1. 1. Not sure how excess proceeds from foreclosure would be split?
2. 2. Would letting the property go to foreclosure benefit the “original” owner more?

Thanks