Do your research and do your home work when looking at forclosures. Know the are you are buying in, find out what is a reasonable price for a similar home. Look at the property and bring some one else with you to be an objective observer. Write out lists of possible repairs, if you see anything suspicious have a specilaist do an inspection.

Even though there has been a high amount of foreclosures in the nation, they have been touted as "easy money" by real estate investors trying to sell seminars more than real estate. Regardless of where the hype came from the demand is still perhaps more than the supply. For this reason banks have been able to sell their homes more and more at "market value." For instance, Freddie Mac through HomeSteps will actually renovate the homes themselves in order to make them available for full market value. Their goal is to sell them to "end users," or people who plan on buying them as primary residences. In fact, HUD will only sell their homes to end users first, and then open the auction up to investors. Because of this, HUD auctions are flooded with investors, getting a bid in only after end users get a shot at them.

Doing your "due dilligence" is key. It's important to have a prelim title report done on the subject property(either by you or a 3rd party) to make sure there are no clouds on title.

The key to investing in forclosures is to start early. Contact you local title company and have lists of NOD's emailed to you. This will give you a starter list of homes that are facing forclosure. If you have issues getting the list then contact a Real Estate professional you trust. They can get one for you.

Typically, competiton for forclosures is very high. Be sure to act quickly if you see a good opportunity.