Unless you’ve been to a few foreclosure auctions, there are a few things you need to know before deciding whether or not to show up on the county doorsteps and start making bids.

Foreclosures have been around for as long as there have been banks and houses and owners can no longer afford the real estate investingpayments the bank goes through a legal process that allows them to recover the home. Here are some things to consider that might make you want to avoid the auction entirely.

Once a home has been foreclosed upon, the bank can put the home up for auction. Most often this occurs at the county courthouse where the property is located but there can be variances with this. The bank lets the county know the minimum amount the bank will accept and the county posts the notice for a future auction.

However, a potential buyer won’t have access to the property. It may be locked up with a big “foreclosure” sign in the window. You might be able to peek through the window or walk through the back yard but many times you’re almost buying blind.  You had better get a very, very low price as it’s highly likely the costs to renovate the home will exceed both your physical and emotional costs.

There can be title issues as well with unresolved liens still filed against the property which must be addressed. You can research a preliminary title report by requesting such a report from a title agency or an attorney but you may only be able to view the preliminary report, one that is available within a few days of the request. The final report won’t arrive for at least another week or two so.

To avoid any unfortunate events, you should contact the bank directly and work with the REO department. Real estate owned by the bank will have any title issues and physical defects repaired before selling. Yes, the price may be higher than what you might have gotten at the auction but there are no costly surprises, either.