Foreclosures are sometimes a popular and for some, a fun way to make some cash $$.   With the market the way it is now, this is probably more true than ever.

Normally you can't inspect a foreclosure before an auction so be prepared for a few hidden costs (think some lurking utility bills).  Since laws vary from state to state and county to county make sure you do your homework before starting.

Also, you can work with a title-search company.  They can help you figure out if there are any outstanding liens the property.  You might also consider negotiating directly with lenders to buy bank-owned homes. In addition, some companies allow you to negotiate directly with lenders and buy a property owned by the bank. :)