Condo Conundrum

[Jake Maughan]

I've got a real doozy of a deal that I need advice on.  

Long story short - A relative of mine has gotten into financial trouble and will shortly file for bankrupt.  He's moving out of his condo in Springville, Utah and a few family members have approached me asking if I'd like to buy it.  While doing my research I discovered that during hard times, my relative reached out to an associate of his to help cover some costs (including the down payment).  To persuade the associate to continue helping with payments, my relative signed the deed over to his associate (who is an experienced real estate investor himself); however, my relative still has a loan on the condo for $150k.  I called his associate and learned that he's into the property about $45k and would gladly sell it to me for $50k. 

Has anyone heard of a situation like this?  How do I go about buying the property?  The associate owns the deed, but my relative has a loan on the property.  I called my mortgage lender and he hadn't heard of anything like this before. 

BTW - I found some comps and believe I could do a little rehab (the apartment was smoked in and stinks) and sell it for between $225k and $250k.

Any help would be much appreciated!