Unless you have oodles of cash, months to wait, and are willing to risk 10% of the purchase price being taken away without any recourse, buying a foreclosure in Hawaii is not for you. That's because the process in Hawaii is an expensive process that can often result in failure when the court decides the home owner gets to keep his house. You can lose your 10% deposit faster than you can count it.

The better way to go is to buy a short sale. Let me give you some tips for short sales.

1 - look for a seller who already has lender approval at their list price. This will cut months off your wait time.
2 - get your loan approved, fully approved, before you even make your offer. Again, this will cut down the time it will take to get an approval from the seller's lender.
3 - Make multiple offers. Just find 2-3 homes that you might like and make offers on all of them. It can't hurt, and whoever approves you first may be the winner.
4 - Be patient. It can take months.
5 - Work a Realtor who has short sale experience.

There are currently about 200 short sales available in West Oahu, and a few, maybe 20 in East Oahu (Diamond Head, Hawaii Kai), and about that same number in Honolulu. There are even a few on North Shore and, Kailua and Kaneohe.

The key is that short sales take time, but are way less risky than a foreclosure.  The short sale I listed today is a great example of how you can get a great deal on a home.