Arne, You can tap into this market yourself. The question is - where does those companies that sell the information to you get their information from? And Deborah has practically given you the answer. As she said, this is really a legal issue therefore you can find this list in the county / parish civil court filings and also in the news papers. It's all PUBLIC RECORDS and most city newspapers actually print the list of "distressed" home owners. Embarrassing, isn't it? But this is done according to the laws controlling "notice and intent" to foreclose. Just call the clerk of court and the newspapers and ask them the relevant questions, or visit you local law school or university and ask the law clerk in the law library. They are always helpful.
That is the only way to do it independently, but that requires a little more work. That's why people just pay those scam artist that you mentioned. The problem with those guys is that "sometimes" their list are old and outdated and their leads are bad. You have to be careful with the company you pick if you choose to use their services.
If you don't mind, I would like for you to contact me and tell me why you want to get into foreclosures right now anyway. Personally I don't think this is a good idea and I'll explain why. But I wont do it here and now because it was not asked.
Hope I said something to help you.
Yes, many companies collect the data on foreclsoures and try to make money from sellng the data or selling ad space on a web site that houses the data.
As Deborah says, these are properties in pre-foreclosure, not necessarily properties that are on the MLS. Actually, though, from an investor's standpoint, that's fine. I can contact those owners and ask if they want to sell me their property. I'm not competing against the hyper buyers who figure the only good deal is a short sale or REO. And if I (or another investor) buys directly, and it's not listed, the seller can save the real estate commission. That can be a persuasive argument when talking to someone in preforeclosure.
So, if you want to pursue foreclosures listed for sale, your best choice is a Realtor. If you want to pursue foreclosures that may not be listed for sale, you can either do the research yourself (combing through the newspapers, compiling the data) or pay someone else to do it for you. Not a scam. Just capitalism and free enterprise.
Hope that helps.
As far as properties that have already been foreclosed on, are now bank-owned (REO) and are for sale on the open market, you can talk to an agent who can set you up on an automated system that emails you bank-owned properties for sale that fit your specific criteria.
The area you're looking in (Arlington) utilizes the local MLS, which is called MRIS. The MRIS has special fields an agent checks to filter the search in order to find REO and short-sale properties for sale.
If you wish to use an agent, find one that you feel comfortable with and ask them to set you up with those updates. If they don't know how, then find another one that does.
I'd be happy to chat with you more about doing so if you'd like. I focus on Fairfax and Loudoun Counties in Northern VA. Here's my bio - http://realdiablog.typepad.com/about.html