There's one not far from where I live that I watched being built, huge house. More like a mansion. Story goes was contracted to be built but before it was finished the owners were transfered away and turned it over to the bank. Listed by the bank for a cool 1.2mil. Guessing about 6000 sq-ft w/in-ground pool, pool house, attached and detached garages sitting on about 3 acres. Drove by yesterday and noticed the siding is starting to mold. 
Klayfish said to Carguy123: You won't get any disagreement from me there. I guess it was a "perfect storm" for us. Screaming deal, nice neighborhood (very unlikely to have been targeted by thieves/vandals), newer construction. If you close loans for a living, I'm sure you've seen a ton of horror stories. My wife and I know how lucky we were to grab this one.
Yeah, same here. We didn't do as well as Klayfish, but our homework paid off. If I had to elaborate on anything I've previously said, it would be this:
Even if you're paying cash for the thing, HIRE A GOOD INSPECTOR.
Stroker, I hate it that your situation is because of a divorce, I'm hoping you don't just jump on the first one you see (we almost did--see HIRE A GOOD INSPECTOR). Carguy's made some good points here..
What about tax sales?
Seems like they are much more complicated and aren't "digital" as foreclosures.
Here is my understanding of how tax sales work in my area (MO). Some may be the same in other places...other stuff may not.
I haven't actually participated in a Tax sale, so I'll try not to get too detailed.
Real estate owner does not pay real estate property tax for a certain period.
State lists the property at tax sale. (If there's a loan, I assume this is where the bank promptly pays the taxes to protect their investment...and bills the borrower, plus penalties...thus removing the property from the Tax Sale).
Tax Sale Bidder bids (at least the amount owed in back taxes) on the property and, if successfull, they receive a Tax Certificate (or Tax Certificate of Deed or something along those lines).
Successfull Tax Sale Bidder must send registered letter to current real estate owner saying that if they are not paid (plus interest) in...like...two years (I forget the time period, but it's something like that) the deed will transfer to Successfull Tax Sale Bidder .
At this point the Real Estate Owner probably begs, borrows, and/or steals payment...but if not...
At the end of the redemption period (again...something like two years) Successfull Tax Sale Bidder applies for a full-on deed to the property, as long as they followed all the rules.
So...it's a long shot to actually GET a property this way, but if you've got money sitting around, it's probably not a bad hobby to get into. I'm guessing the interest you are allowed to collect would beat CD rates at any given time.
Clem
Clem's assessment of tax sales is pretty much how it works here in SC. There are people who do it strictly for the interest income, they don't really want the house. You have to be careful, though; in a lot of cases the taxes have not been paid because someone has died, the heirs are squabbling and the house is crumbling. So it is easy to wind up with a real stinker if you aren't careful.
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