Preforeclosure and subject to discount with bank

[Troy Michaels]

I saw a video a real estate video, and they were speaking on negotiating a discount on a subject 2 property with the bank.

im confused about something. ok, lets say you do a subject to on a pre foreclosure, and get the deed. where im confused is, normally, in a subject to, you just take over the payments and pay the remaining loan balance. in the video, they say you can negotiate a discounted payoff. are they saying that the discounted payoff is negotiated DURING the preforeclosure, as soon as you get the deed, etc. or is it part of the EXIT strategy? in other words, when you sell the house, thats when you negotiate a discount on the payoff? and if so, how long would you hang on to the house before doing this, because seems like when you pull the house out of foreclosure, the bank has no incentive to negotiate a discount.