Bill,

If there are water stains on the ceiling, then it's pretty likely that the home has (or has had) a roof leak or plumbing issue. You won't know until you have a professional inspector take a look. If the home is a foreclosure, the water is probably turned-off making it tough/impossible to get an answer.

I wouldn't necessarily exclude a home because it has a plumbing or water leak - often these can be easily fixed. Having said that, I would be concerned about mold if this was the sign of an active plumbing leak -- your inspector should definitely check out the attic space. Mold can be very expensive to fix.

With any property - foreclosure or not - have a detailed, professional inspection. You're the buyer, so make sure your inspector addresses every concern and question that you have.

Good luck.