Foreclosures are bought at the courthouse. Generally, these are properties that were probably for sale at some point, couldn't sell for various reasons, and went into actual "foreclosure". The owners were unable to pay... most likely didn't pay for 6 months to a year or more. Chances are (in this market) the owners owed more than the house was worth.
Normally there is a list published online, found by looking at that county's website for foreclosures. There should be a daily list of all properties that will be up for sale that day. The lists are generally pages long. There will be an address and contact information for the lienholder that is foreclosing on the owners.
If considering buying a foreclosure, MAKE SURE to research that property. There could be 2 and even 3 lienholders in line for money in addition to the first. The property could possibly be set at a price ABOVE market value. All too often properties sell WAY above current market value. Bidders get caught up in the action, they fall in love with the house and emotion takes over, or they don't do their research!
And worse, the condition of that home could change THAT DAY! If the owners or tenants were angry (happens WAY TOO OFTEN) they could have trashed the house. We hear way too often cases where the front door was stolen, the kitchen cabinets, the appliances - gone. Holes might be left in walls, kitchen sinks ripped up. There is no failsafe way of making sure the property remains unaffected - up to the day it is sold and you can change the locks so no one has access.
To buy a foreclosure at the courthouse, you'll need cash or a cashier's check for the full amount. BE CAREFUL when getting to that point! You are buying "as is"... no guarantee of clear title, of structural soundness, etc.
The most common outcome of an auction is that there are no bids and the property is "sold" to the lender. The lender then places their newest "REO" (real-estate owned) property on the market for sale.
REO properties statistically don't sell for less than 5% below market value, if that. Remember banks aren't stupid... they will try to recoup every penny of their loan and all legal and other expenses they've incurred. Chances are if you see "bank-owned" it won't mean "deal".
Due diligence and research are key to avoiding major financial catastrophes!
