Agents looking for personal buying opportunities outside of the MLS
There are several time frames to potentially capture distressed homes before they get taken back by the bank/lender and listed in the MLS or put on an online auction.
1) The earliest step is when the Lis Pendens is filed. This happens when a loan is at least 5 months behind and the bank files public notice that they are beginning the foreclosure process. These properties can be identified on an ongoing basis using Realist or iMap (and other sources). Lots of people chase these, to try and buy, list, do a loan modification, etc, and most homeowners at this point aren't interested in selling for a price under market value, but occasionally you'll find one that does. Even then however, you will almost always have competition.
2) At the foreclosure auction. In Florida, all residential foreclosures are judicial, which means it must go through the courts and a judgement will be awarded to the foreclosing lien holder and the property ordered to be sold to satisfy the judgement. The lender's judgement will include delinquent interest, fines, attorney's fees, court costs etc., in addition to the unpaid principal balance. This judgement will automatically become a bid on the property at auction on behalf of the lien holder and can often exceed the value of the property. Lenders will sometimes cut pre-arranged deals with intended bidders in advance of the auction to withhold bidding the full amount of their judgement in order to allow the bidder to win the sale at the auction for an amount less than the lender's judgement. These arrangements typically must be made with the law firm handling the foreclosure for the lender. The buyer must pay cash - they may have borrowed the money elsewhere, but the foreclosure auction sale bid/price must be paid in cash. Buying a property at a foreclosure auction is risky because you have no guarantee of clear title. The loan in question will be satisfied and any junior liens will be wiped out, but there could be senior loans, liens or claims on the property. You should do a title search on a property before bidding on it at the foreclosure sale, whether or not a price has been prearranged. There may also be tenants or holdovers on the property that you would have to deal with. Not to mention damage, theft, etc. that can occur at any time prior to you being able to secure the property.
3) It is also possible to buy a property from the lender/servicer after the property is foreclosed on, but before it is put on the market. This normally requires knowing someone at the asset management company or at the lender's REO department. It is unlikely to happen unless you have a lot of cash and are willing to purchase multiple properties.
4) In some cases it is possible to redeem a property that was just foreclosed on, without the banks permission, or permission of the entity that purchased it at the foreclosure sale if it didn't go back to the bank. This must happen after the foreclosure sale has occurred but before the Court Clerk files the Certificate of Title, approving the sale. This is sometimes possible with seller's who were unwilling to sell, hoping to continue living in the property for free for as long as possible, but once the home is finally sold at foreclosure, reality sets in and now they are willing to take something, anything, instead of the alternative, which is nothing. Here again, you need cash, and you need to act quickly, if possible the same day the property sold at foreclosure. You might offer to let the seller(s) stay for free for a couple of months, then give them a few thousand for moving costs, in exchange for deeding the property to you when you pay off the foreclosure judgement. If done properly you can sometimes get the property for significantly less than it actually sold for at the foreclosure auction. The key is getting cooperation from the seller, because you cannot redeem the property for them, they must do it themselves, and you will need to give them the money to do that. It's a complicated and risky process but it can work if you diligently do your homework.
5) There are companies that sell leads of people who are looking for a quick sale of their property, but these people think that you will be offering them a "fair" market price for their home, and they expect the offers to be cash.
You should also keep in mind that as a licensed real estate agent and REALTOR, you must tell a prospective seller what the market value of their home is, if you are offering to buy it for less than market value (unless it is already listed for sale by another agent who is not participating with you in the purchase). They must be willing to sell it to you even though they know that they may be able to get more money for it by listing it for sale.
Essentially, there is no easy way to buy real estate under market, but it is possible, if you can pay cash. Financing a purchase greatly limits your opportunities for under market purchases and for the most part you will be stuck looking for homes that need to be rehabbed, and you can preform the necessary work for less than the value increase once the work is completed.