its not new dude

the 65K loan will not be possibly a mortgage based loan as banks don't do the 125% etc loans anymore, you'll be lucky to get 40000, generally its a good idea but work on the loan part, the reason you get the foreclosed properties so cheap is that credit is tight and new loans rare and last not least everybody needs one and so a lot of foreclosed properties in the market.

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thank you. your right the loan part I will need to work on, since lending is getting so tight now I will have to get a loan for a decent amount and buy the house, and update the house out of pocket. better approach?

I think it is a great idea if you can do it. If you are able to manually do the repairs yourself it will lower your cost significantly. Just remember, if you get into something like this it isn't a short term investment. Yes you can make money but it could be a while before you ever do and you will have to continue to do repairs even while it is being rented out. If the heater goes out or something, you will be the one responsible for getting it fixed or replaced and yes that means you pay for it!!!

Sounds like a good idea, just make sure that people will be willing to pay the rent. And in anticipation of down months/year without a tenant, that you can afford to keep up with loan payments (and other miscellaneous expenses) on your own income.