Buying Dropped Domain Names
A "dropped" domain name is one that was registered by someone at one point, but was not renewed and "expired". After a waiting or "redemption" period the domain is finally released so it can be registered again by anyone that is interested. At this point it is considered to have "dropped".
In general, dropped domains are nothing to worry about. There is a good chance that many of you have registered a domain that was owned by someone at some point who later decided they didn't want it.
Because the domains are inactive for over 30 days before they drop, some of the history of the domain fades and does not affect a new owner's use of the domain too much. But there are exceptions:
1) If the domain has many links pointing to it and it has been published on many sites, the new own MAY realize some benefit from the past usage.
2) But the reverse is also true. If a domain was involved with SPAM or illegal activities it may have a "bad reputation" or be banned by some systems.
The first condition is more likely than the second and the problems encountered in the second condition can be corrected by contacting sites that have blacklisted the domain to make them aware that things have changed.
A third problem could also be connected with a domain that has dropped. That is where the previous owner was not aware that the domain expired. They may have thought to register it again when it became available. If you should happen to register it before they do, they may feel you have "stolen" their domain. They have NO legal ground to stand upon, but they may not accept that as reality.