You are new to Real Estate investing and you've heard from your fellow school mom that the way to make money in this business is to flix & flip homes that are going on a 'foreclosure' because you can buy them really cheap. I can't tell you how many people get started in our industry with the above premise. While quite true - finding 'cheaper' or below market value homes should absolutely be your first step, there are much better & more reliable ways to find these homes than a typical foreclosure.
Read below to see how professional Real Estate investors find these deals; and trust me anyone can employ do all these tactics irrespective of experience :)

1. Foreclosures

Essentially, owners did not make mortgage payments for a while and the banks are now selling these homes (or sometimes the liens) at a public auction. These foreclosures legally fall under the category of 'trustee-foreclosures'; also called Pre-foreclosures

2. Tax-Sales

Properties being sold at a constable/sheriff run public auction because of unpaid property taxes. Beware you could be buying a 'lien' and not a 'deed' to the property at the auction (varies by state)

3. MLS Listings

Multiple Listing Service is basically an internet-board where your local agents & brokers list the properties for sale. Often these listings are combined by aggregators such as Zillow or Realtor.com


While above are great ways, 90% of the new-investors compete in these 3 categories above.
The pros operate in the categories below :) 
Most times you can find deals 2-5 years before they will land up on the MLS or a foreclosure

4. Property Tax Delinquencies

Constitutes people who are behind their property taxes. Folks could be in these stages - Delinquent/Suit/Judgement

5. Loan Modifications

Folks who can't make their monthly payment & are asking the bank to 'modify' their loans. This is years BEFORE foreclosure proceedings begin

6. Appointment of Substitute Trustee

Bank appoints a local trustee (law-firm) to start foreclosure; typically a couple of months before the actual foreclosure proceedings

7. Probates

When a person dies, an executor appointed as per the will (or the state in absence of a will) begins the process of 'distributing' the assets of the decedent

8. Estate properties

In these cases, the probate cases are typically settled and the property is in the 'estate' of the deceased and hence (often dis-interested) heirs

9. Divorces

Couples going through a divorce and realizing that one spouse can't afford the house monthly payment

10. Evictions

Landlords filing a case to 'evict' a non-paying tenant. Caution - stay away from NON-landlord friendly states like California

11. Neighborhood citations

Local cities issuing a ticket to homeowners for various nuisances such as - weeds & overgrown vegetation, trash, abandoned homes etc.

12. HOA Liens

Homeowner associations pursuing home-owners for association dues; often made very powerful in deed-restricted communities with strong HOAs

13. Hospital Liens

Hospitals filing liens on homes because major medical bills could not be paid; often a pre-cursor to other delinquencies

14. IRS & State Tax Liens

Unpaid uncle Sam bills, encumbering business and homeowners assets

15. Absentee & Out of State Owners

Landlords, often accidental, who may be emotionally detached from the houses

16. Utility Disconnects

Homeowners with no Water on the property, indicating often abandoned properties

17. Recently flooded

Properties affected by a natural flood event and homeowners have been made whole by the insurance payout. FYI- stay away from properties with a history of 2 or more prior floods

18. Expired MLS listings

Homeowners who tried selling their properties with a local Real Estate agent with no success; this also includes homes currently listed on the MLS for an unusually long time

19. Over-65 Exemptions

Typically older homeowners looking to scale down. Different states have different similar exemptions. 

So all said & done there is a tremendous upside to using methods 4-19 versus 1-3, where you will be shoulder to shoulder with tonnes of newbies competing for pennies on the dollar.