[xyz]

Is it true that the next buyer of the foreclosed property gets a very good deal? Why is that?

[redbeard]

to say that anyone benefits from a foreclosure is a stretch. if you had payed a significant amount of the principal down 10+ years, then the bank would benefit, but when you have bought a house that was never worth what you agreed to pay then the no one really benefits, the bank looses as they have to auction the house for less than they paid for it, and the next purchaser could get a good deal but more realistically they actually end up paying a more fare market price for the house.