Newbie here... dazed and confused

[rehabrob]

I've been targeting preforeclosed markets for two months and my goal is to find preforeclosures with $20k equity.  But, the callers I've been receiving have little or no equity.  
So, my question is: Why would I sub2 a preforclosure with little or no equity?
All the money I have to put up to bring the loan current ie. mortgage, attorney closing fees, rehab and holding costs.  This doesn't make sense to me.  I've read that you should have $20k in equity before pulling the trigger on a sub2 deal when starting out.

WHAT AM I MISSING?

thanks.
Rob

[$Cash$]

rehabrob,

Glad to meet you.

To answer your question:  Reach them before they get in this position, the beginning pain starts long before the foreclosure starts, just cure their pain when it is just a slight a twinge.

As far as Subject To goes, there are many factors that go into whether the deal is right or not, base the deal on how fast will it sell, how much you can get down, what to price the property at, what interest rate to charge, etc.

John $Cash$ Locke