For this reason, buyers who purchase a foreclosed home without employing professional home inspectors are asking for trouble. They deserve what they get. In fact, the foreclosure market may not be a good one for first-time home buyers who aren't experienced in buying real estate. I usually don't recommend that inexperienced home buyers go the foreclosure route. It's all a matter of knowing where to find foreclosed properties, having the skills necessary to handle repair work on your own and having the good judgment to walk away from certain properties, even if they do fall into your price range.
Homes reach the foreclosure market if their previous owners have defaulted on their mortgage loans.
When this happens, the banks or lending institutions that originated the mortgage loans take possession of the homes. Both of these departments issue mortgage loans. When the holders of these loans default on their payments, the agencies take possession of their homes. Finding HUD and VA homes is relatively easy. VA homes are a little trickier.