How would you "Tie" this deal up?

[Greg P.]

Hello, I have a guy who is willing to sell the house for whatever the bank is willing to take. He just doesn't want the bank to foreclosure. Fortunately, the bank is local and the bank is willing to accept a low offer. How would you structure the deal so the owner cannot back out? Also, he is worried about a 1099 since he is selling the house for less than what it's worth he is afraid he'll be taxed on the different from the amount we pay the bank and what he owes. I've never heard of this, but is there anything we can do? Thanks in advance!!

[John Chan]

The mortgage debt relief act of 2007 may forgive him of the cancelled debt, depending on whether this was his primary residence and a few other factors. You may want to ask for legal counsel on this matter.