You can use many websites to search foreclosures and contact an agent in the area you are looking to set up a time to take a look at the home or do some research.
The most common type of foreclosure property you will find in your home search is a Real Estate Owned, or REO, property. REOs are properties that have been foreclosed on and are now owned by the bank.
REOs may be vacant or in need of repair. But often they look and feel just like other homes for sale, and they're listed by a real estate agent. Although they're typically sold as-is, it's not uncommon for an REO to be in move-in condition. The process of buying an REO is different than other home purchases.
The categories of REO properties:
Move-in ready: The home is in acceptable condition and not in need of many repairs. You could buy this property and move in quickly depending on how fast the bank that owns it wants it sold.
Damaged: A damaged REO generally needs rehabilitation and repairs before you can move in. To investors and some buyers who aren't daunted by the work involved in rehabbing a property are attracted to this type of home for sale. You may get a bigger discount on a damaged REO property, but you have to consider overhauling costs.
Advantages of buying REOs:
• Sometime you may pay a below-market price for the home.
• The process is somewhat similar to a "normal" home purchase in that you can secure financing using a traditional mortgage. (Buying an REO property is nothing like buying a foreclosure property at auction with cash.)
• You will be able to secure finacing and perform a home inspeciton before completing the purchase.
Dis-advantages of buying REOs:
• If there are problems or necessary repairs most banks will require you to sign an "AS IS" purchase, paying for them is your responsibility.
• The process can take longer than a regular home sale.