Essentially, there are three opportunities for buying foreclosure properties: 1) the pre-foreclosure stage; 2) at the public auction; and bank-owned, or real estate owned (REO).
The first step is to determine which stage of foreclosure process you are interested in and figuring out strategies to successfully purchase in that stage. There is a lot of effort to check and follow up on the properties, and most of the sellers are not accessible. Private persons do not want to share their circumstances of the distress situations, and banks using a third party to handle the REO. On the scale of the ROI the pre-foreclosure is the most attractive but require to approach the borrower/owner. REO is slim in the return but is fairly easy. The auction offer some of the best bargains and avoids direct contacts with the borrower/owner of the property, but required cash upfront and carry a risk if not researched properly prior to bidding.