"Foreclosure" has become a buzz word for buyers today.  "we want to look at foreclosures" or "can you send me some information on foreclosures?".  I actually send out a list via email of foreclosures in my area that I compile by mining the data on my MLS;  looking for key phrases like "bank owned" or "addendum must be included with offer".  However, is a foreclosure a smart purchase? It could be, but it may be a bad idea. It depends on your goals and time frame ( how long to you plan on living in the home?)

 I advise buyers to look at the neighborhood and the surrounding area before committing to purchase a foreclosure, regardless of price.  Buying in a neighborhood that is in free fall is like trying to catch a falling sword (timing is everything)  If that foreclosed home is in an area where there are multiple foreclosures, I would look elsewhere.  Sure the price is cheap, but you can also get cheap tickets to board a sinking ship.  

 Buyers would be better off with a smart purchase rather than good deal... look for a reasonably priced home in a rock solid neighborhood.