If you want to own your own home cheaply, you should consider buying foreclosure houses. These houses are usually sold at prices that are below the market value. The purchase is a good way of saving thousands of dollars, which is very necessary especially in this difficult economy. However, you should prepare yourself before buying foreclosures.

First, you have to know what properties are being auctioned in your county. This information is available at the Registry of Impending Foreclosure Sales at your county courthouse. You can also subscribe to websites that offer foreclosure listing services. The subscription price ranges between $100 and $500 per year.

After getting the list of houses that will be auctioned, you have to determine which house is good for you. This may be tricky as many a times you may not be allowed to see the inside of the house before placing a bid. To approximate the value of the property, use the information provided about it such as the number of baths and bedrooms, and condition of property, among others. You can also get recent tax evaluations of the property or engage the services of a realtor or home valuation service.

After selecting the house, you then have to determine how much you are willing to pay for it. A good foreclosed property is usually priced at between 70-75 percent of a comparable property in the neighborhood. Compare other similar properties, asses the value of the home, and use the 70-75 percent rule and your budget to determine the bid limit you can afford.

Before making your bid, you should have your financing ready to go on when the auction is over. This will require you to be pre-approved and pre-qualified for the mortgage based on the amount that you plan to spend in buying the house. Having financing ready ensures you do not lose the foreclosure houses you've put a bid on and also presents you as a stronger bidder.