This would be doing a subject to and then renting it to a tenant buyer that could possibly put down the amount of back payments owed as a down payment.  

You would get your principal and interest, but the new investor now holds the lien for both years and can foreclose if the owner does not pay.

Regardless if the home is sold 5k or 500k under what is owed to the bank, the seller generally gets nothing. 

I've thought of something along the lines of paying him the back taxes owed + penalties (~2k) as a "down payment" and making payments from there with whatever terms.As he is a realtor, I'm sure he knows the tools and tricks of the trade. 

"A broker may not take net listings unless the principal requires a net listing and the principal appears to be familiar with current market values of real property.

The client called her house was approved for a short sale she owes 215,000 on the house it is worth around 175,000 has not been lived in for a year.  6.5 % interest on the first. 

Plus, the repricing lowers the principal every year if I go 1 year.

Other (like mine) require you a minimum payment that includes principal (mine is 1% of the balance).

The HOA will probably bid on the property as well, if they are owed anything. 

We owe about $400K on our home worth about $700-$750K, so ideally I would like to downsize and get a good chunk of that equity out to use for investments.