You are correct, it is simply too good to be true. The owner of this property likely used it as collateral for a loan and has defaulted on his/her obligations. The lender has filed a notice of foreclosure and is trying to force the sale of the property to be repaid. However, it is very likely that there are other loans, i.e. the first mortgage, that also have a claim on the property and claims are paid in the order they are recorded at the courthouse. Aside from the primary mortgage, property taxes, homeowners' association fees, unpaid contractors who worked on the property, may all have liens filed against the property.
Many of these liens will run with the property and become the responsibility of the new owner. If the $13K creditor were the only one to satisfy, there would be many bidders at the courthouse that would drive the price up closer to its market value.
Buying these properties requires a large investment of time and research. Title searches are required to find liens recorded against the property and financing is more difficult than in the past. There are opportunities out there, but when you see them on sites like Realtytrac they have usually been passed over by professional real estate investors.
If this type of investing interests you, start with your lender so you understand all the new guidelines for buying investment property. The rules for down payments, cash reserves, etc have gotten much tighter.
Another good option for finding foreclosed property is the HUD website. These are homes that had FHA loans that went into foreclosure. The site has electronic bidding for properties in the Charlotte area. These properties are free of all liens. You can use a real estate agent to help you preview properties and determine the market value and the amount you should offer. The seller pays the agent's fee.