mailing list software

do you guys use any good software to manage your mailing lists?

i get pre foreclosure lists and send out hundreds of letters, from which a few dozen come back (return to sender)…

i keep my list in excel, but its complicated to add every week the new addresses, and to go through the hundreds of addresses and mark the ones that came back and not send letters to them anymore.

how do you guys do it? is there a software that makes this easier?