If a home isn't sold in pre-foreclosure, it often goes to a public auction. These usually require cash or a certified check on the spot. You typically cannot inspect the interior before bidding, making this the riskiest option.
Here is a blog post summarizing what you need to know, from the different ways to buy to the potential pitfalls.
Work with a real estate agent who specializes in foreclosures. In Florida, for example, firms like Gulf Coast Home Experts or the Ace Khan Team can help navigate these complex listings.
For REO properties, you can often use traditional Bank of America or Rocket Mortgage loans, including FHA or VA options. The Cons: