The answer really depends on what you are referring to when you ask about "real estate public auctions".
1. For some people, "public auctions" are those that occur at the convention center, where you get a book with land, houses, commercial property, etc. and there are hundreds of properties to choose from. They are handled by an auction house, like Wiliams & Williams. The financial requirements are spelled out in the auction book or on their web site. Usually, they require $5,000 (cashier's check or cash) on the auction date and you have 30 days to complete your financing. Usually, you receive clear title and title insurance. Usually, you are able to go and view the property on specifically scheduled inspection dates. Usually, if you do not complete the purchase, the maximum you will lose is your $5000, and there are some reasons for not completing the purchase where you would actually get your deposit refunded. Any exceptions to their normal policy will be clearly stated in the auction book and often announced before that particular property goes on the auction block. Many people have gotten a great deal on a home for themselves, a family member, or on their first investment property. If you read the rules and make your inspections, this is no different than buying a bank owned property that is listed on the MLS.
2. For some people "public auctions" are the Trustee Sale. These take place on the courthouse steps (literally on the steps, not inside the building, so bring an umbrella on rainy days). Here you must pay cash for your full bid amount. You receive a Trustee's Deed, not a grant deed. You are responsible for your own title search and title insurance. You buy subject to all SENIOR liens. You don't get to inspect the property before buying, and you can't back out if you find out you bought a headache. This is a place for people who are experienced, have great teams of lawyers, title people, contractors, etc. and can afford to gamble and lose every now and then. This is no place for a novice looking to buy their first home, and this is definitely not the place for someone with limited cash resources.
Hope that clears things up a bit. If you have further questions, please feel free to contact me directly or ask additional questions through this forum. Dare to Dream.
Shel-lee Davis, CDPE
Your Real Estate Consultant for Life
RE/MAX Palos Verdes Realty