This is a loaded question because it used to be, it can be and maybe it will be again one day. Due to the current elevated prices within the real estate market, investing in foreclosures has taken a little downward spiral. This has been good for the financial institutions because the bids have been higher which increases their recoveries.
Purchasing properties at Sheriff Sale is all about timing. It is all about doing your homework. You need to view the exterior of the property, run your comparable sales within the immediate area, run your numbers on potential renovations needed, and determine if the Plaintiff is going to bid the full amount on their complaint because it is a government backed loan.
You will do a lot of leg work and attend a lot of sales before you purchase your first property. DO NOT GET CAUGHT UP IN THE THRILL OF THE BID. BELIEVE ME THIS HAPPENS. Make a decision on how high you are willing to bid and stick with it!
Financing institutions are in the business to recover some of their losses when a property makes it to a Sheriff Sale. They are not in the real estate business. However, they are also running their numbers and if the condition of the property is in good shape, the location is good and the comparables are good, they will purchase the property back.
There are sometimes mistakes that happen and a sale slips by without a representative being at the sale to bid. It is rare but it does happen. These are the gold mines.
Example: There was a property that went to Sheriff Sale. The minimum bid was $27,000.00. It was a 4 bedroom ranch manufactured home on 6-7 acres, the home was attached to real estate, had a full basement and the interior was in really good condition. Three people attended the sale, two were spectators and one was a buyer. He bought it for $27,000.00. He was shocked and said someone dropped the ball. This was all in his favor. This was a great property to purchase, invest in and re-sell. This property sold later for more than 4 times his initial investment.
These deals are far and view between. But, they are out there.