Prequalified=taken off the applicant's information, not processed or verified but if they are close to correct they can tell you what to shop for.Preapproved=application taken and verified, amount is given they are qualified for subject to property and appraisal.

@Junior Salters check out this podcast - they talk all about ithttp://www.biggerpockets.com/renewsblog/2014/05/15/bp-podcast-070-subject-to-grant-kemp/

Does anyone know or have worked with a title company or a real estate attorney that closes subject to (wrap) deals in Chicago area?

You need to know a couple of things to make an offer:1) The "comps" - what did similar houses sell for recently (need a real estate agent partner to get these from MLS)2) The repairs needed on the subject propertyTo make it an apples-to-apples comparison, you need to understand the comp values in "$ per square foot" so you can apply that to your subject property.  

I recently decided to embark on a real estate investment company and the process of educating myself on the subject.

The deal brings a 25% CAP rate, huge cash on cash return and 35% purchase CAP.House #1 4 units (2/1), 3 occupied paying $425/mo (very low) I plan on occupying the vacant unit for awhile.Sale price is $35000 Subject to $22000 first lien on property.$0 down (with agreement on house 2)10 years remaining on lien $430/mo including taxes.Needs new roof within 3 years, $10k and maybe a few updates throughoutHere is the kicker...The seller was just notified of a tenant injury from a few months ago.

You might try searching "due on sale" in Biggerpockets and reading more about the subject.

Hello John, Thank you for your reply, yes two of the comps are on the same street and a third is on a similar street 1 mile south and with frontage on them as well, but with this in mind what would you consider an adequate discount for a busy street property If I were not able to find any recent sale comps (I keep the comps within sales of last 3 months, 200 to 300 sq ft of the subject property and like built properties). 

You're thinking of a purchase Subject To the existing financing. 

I'm currently reading "The Book on Flipping Houses"  and just trying suck up as much knowledge as I can on the subject.