Some are really that cheap in real life. You could be looking at a house that can not be lived in. Some are in bad neighborhoods. Some are best to tear down. Some are actually a good deal.
If you want to find out more about foreclosures and how to find them look here.
Also, any real estate agent can help you to find foreclosures in you area and explain all about them.
If you are talking about Trustee's Sales, which are homes in foreclosure, the banks are requesting payment for the amount due them on the loan plus additional allowable expenses. You would assume any unpaid property taxes and potentially other liens on the property; you'll need a Preliminary Title Report to let you know what these other liens and their monetary amounts would be. If it is the 'junior' lien which is conducting the foreclosure sale, then the 'senior' lien (first trust deed) still remains in place -- and, yes, you would assume the balance of that loan, its delinquencies and related fees, and monthly payment, in addition to 'buying out' the junior lienholder at the Trustee's Sale. Same-day payment (cash equivalent) is required for Trustee's Sale purchases (i.e., Cashier's Check) -- so you cannot bid and expect to have 30 days to obtain a loan.
If a property is on the market and a Trustee's Sale has been scheduled, you can still make an offer to purchase the home, with your offer contingent upon obtaining a loan to buy the property. You'll get clear title and have less competition for the home, too.