Reselling back to the would be foreclosed party

[Mark Enriquez]

Is it an option to offer to purchase a distressed property from someone in pre-foreclosure, and letting them stay in the house to rent for a year then sell back to them? 

To Clarify:

• I'd buy the house from the occupant who is under foreclosure
• After the sale, I'd rent to the-would-have-been-foreclosed party for the period of a year (a year in general, could be longer) then give them an offer to purchase the home back?

**I wouldn't try to rob them blind on the resale. I'd of course sell back at a reasonable price. 

I'm not sure if there are laws against this type of transaction. I don't see how it would be terribly unlawful. I think lenders would have the biggest beef with it. 

I don't have anything like this in the works, but I would try it out if it were not unlawful or unethical. 

thanks,

mark

[Randy Thomason]

The biggest point (besides legality) you should be looking at is this, 

If they couldn't make their mortgage payment before to a bank who can destroy their credit, why do you think they would make a payment to you? 

And I assume you are going to rent at market or close to market rate, which should be higher than the mortgage payment they were supposed to be making (in most areas anyway).