Last March we saw a house we liked just down the street up for sale for $300k. Our neighbors were close friends with the people. In passing conversation near the end of April, I mentioned I liked the house but didn't have the money, blah, blah, blah.
The neighbor told a facinating story of drug use/abuse, spousal abuse and divorce. He mentioned that the wife got everything in the divorce and wanted to sell the house badly. I should call and make her an offer.
I called, didn't offer anything but asked her what her bottom line was. Lets say it was significantly less then the listed price. I called the realtor and got a look inside. It was a bit of a mess, so I offered about 10k below what her "lowest" price was. She took it AND payed closing costs. I put 6500 back into the house, we moved last Tuesday. Went from a 1500 sq ft house to a 2400 sq ft house on a much bigger lot (1/3 acre). With my improvements/cleanup, etc., the realtor now values the house at 320K, which means I have about 80K in equity (yes, thats not an actual appraisal).
Ahhh...the benefits of luck and sweat equity. I did all the work myself. Paint, laminate floors, carpet, AC, kitchen cabinets refaced and new appliances. It also helps to have friends in the flooring business and the appliance business. Significant savings were realized there.
Good luck with your purchase, Cheese