is selling a foreclosed house and lot legal?

the house and lot is still in mortgaged with a certain housing company. however due to unpayed obligations,the said property might be assesed to foreclosure. now, the current "owner" is selling it to me.is it legal to sell a foreclosed property? even if it's still in mortgaged? i hope you can help me with this.

yes,but since it is mortgaged,he should sell it to you at a lower price because you will be assuming the mortgage.this is called sale with assumption of mortgage.thus,you will pay the obligations of the seller.

In connection with this, I also recently purchased a foreclosed property. This was under a real estate company. The house was abandoned by the previous owner and then the developer resell it on what they say is a discounted price. In the contract, it was stated that the house is sell as it is and the reconection for the utilities is not covered by the developer.

We got the certification to move in and we were provided the necesarry documents to apply for water and elecity for the house. When we checked on the arreas of the water bill of the previous owner, it's a wopping 12K and this is only for 9 months. The developer said that they cannot provide any assistance regarding this issue base on the contract that I signed. My thing is we did not occupy the house and yet we are paying the bill of the prewvious owner.

What is the next step we can do on this.