It's always tempting to go for bank-owned properties because of all the things we've heard and read about good deals. And yes, there are quite a few, even in the high-end prices and topnotch areas.
Hopefully, in searching for these properties, you are not throwing caution to the wind.
Nearly all banks, after they foreclose, will engage a realtor to list the property for sale. These realtors are "graded" based on how quickly they can get a property sold, how high they can get for it, and for as clean an escrow as possible (no drama, no headaches).
As such, these realtors will post these properties for sale on the MLS which in turn are picked up by multiple sites --- so these properties will show up in more than one place.
To protect your interests, engage a separate realtor to represent you as your buyer's agent.
Be aware that
1. If you buy a property at auction, there is no guarantee that you can get title insurance for it --- the escrow officers will tell you this up front. It may take a year before you can get insurance. If the property is for sale at a trustee sale at the county courthouse, be prepared to bid (seasoned investors prepared by bringing cashier's check as a they bid in increments),
2. There are no guarantees. The sale is AS IS. So DON'T WAIVE your right to buyer investigation /inspection. If your offer is accepted, invest in a good inspection. This is recommended whether you buy a foreclosure or regular sale. Better to know right away the extent of damage/repairs and factor that into the total COST of buying and rehabbing the property
3. If you are getting a loan, note that some loans may not be approved if the properties don't meet certain guidelines. For example, some homes may be looted and stripped of appliances. If there is no working stove in the house, the kitchen is considered non-functional, and the house won't qualify for a loan.
4. Engage a realtor experienced in writing offers on bank-owned properties. For example, you can/should ask for title insurance to be paid by the foreclosing bank. Most banks won't pay for repairs or repacements since the sale is AS IS. Most banks won't pay for HOA delinquent fees/fines/penalties. Some foreclosures may not qualifiy for FHA/VA loans. Who pays what for city and county transfer taxes?
5. Remember that not all distressed homes you see on certain sites, like RealtyTrac, are bank-owned. Some of them are pre-foreclosures where the owners have an opportunity to cure the default. Others may be on sale as short sales.
6. Whichever type of sale you get, bank-owned or regular, ask or get a home owner's warranty. Many of us offer this free of charge, or as a gift to our clients. It's an inexpensive way to have peace of mind.
Good luck on your search!