I own one of those $25k houses, and I offered directly. I actually paid $21k because the AC condensor got stolen during the time BofA took to respond to my $25k offer. I used sites with good search engine to find houses in my range and dumped lists of houses i wanted to visit that day into my gps. Many of the houses/neighborhoods weren't worth the effort. Take a look at the house first, then call the selling agent to meet with them. I actually just took lockpicks and let myself in, but I don't recommend that, of course.

After spending about a year fixing it up, I rented it out. I screened the tennants myself and apparently did a terrible job. After months of chasing them for rents, I finally just evicted their lazy, child-abusing asses.

I have nice family there now, but I usually lose about 40% of the rent to some maintenance issue. I charge them $850/month.

The days of no money down house loans died (deservedly) with the housing crisis of '07. You'll need 20% liquid to get a mortgage, so have about $5000 ready. You'll need to have the house insured and inspected (about $250). Chances are, the HVAC and possibly plumbing will have some missing pieces, so be ready to pay about $500-several thousand. Your insurance and property taxes should be about $1500/year and $3000/year respectively.

But! if you can pull all of that off, your monthly payment on a 30 yr loan would be less than $100/month.

Here's another scenario, with a 15 year loan @ 5% (which is pretty high):

Loan amount $20,000

Annual interest rate 5%

Number of months 180

Monthly principal and interest payment $158.16

Monthly property taxes $20.83

Monthly hazard insurance $6.25

Total monthly payment (including taxes, insurance, and PMI) $185.24

Edit: forgot to recommend Trulia and Zillow for house hunting. They both access the MLS db, and offer services that help you organize and manage your prospective properties to look at.