Here is a great resource of homes which are in a short sale position where the owner has not been able the mortgage payment and the mortgage amount including the penalties are higher than the value of the home itself.
There are good values to be had, however the process may take awhile before the lender agrees to the terms of the final amount they are willing to pay. Some of the properties have already been foreclosed and are now owned by the bank or financial institution.
All these homes are called distressed homes or assets and may or may not require renovations to be able to be occupied. This is not always the case but a buyer needs to be aware of this situation when buying distressed homes or condos or townhomes.
After closing these properties are free and clear and the buyer will get a clear title and title insurance. The owner, the banks will not make any repairs prior to closing. There could be exceptions but that is rare.