Flipping VA 1st W/conventional 2nd

I have a seller who is in the process of being foreclosed.

1st $140k VA
2nd $25k conventional
rehab 8k
Appraisd value $205k

The homeowner wants to sell the house for $170k. I want to put him under contract for asking price, however my questions are how do I deal with fha on 1st. Can loan be assumed in this case? I know that there is a new law concerning flipping on fha's. Can you please advise me on how to draw contract to protect me and him. I want to assign the contract to an investor.

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