Dont feel bad
I dont think that you should feel bad for buying a foreclosed home what you are doing does not really effect the previous owners it would be different if you had been the cause of their problems.
On a slightly different matter I was watching an antique program the other day where this chap had been called by the lady in the charity shop to look at this lamp he offered her £20 for it and then sold it in auction for £180 and he didnt seem bothered at all . Didnt seem right to me
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