Lot of repo's on the market for very good prices. Low balling is an option for negotiation. Look long and hard at the home, I'd check every nook and cranny from basement to attic.
116K home next to me went 45k from fannie and now its sitting over a year with the owner making payments he didn't plan on.

I'd say you own the market, you got time...shop.

last thing, don't jump into anything...once you sign, its yours.