Foreclosure is the process by which a lender or bank repossesses a home from the owner, resulting from the owner failing to make payments on the home loan. Foreclosed homes are often marketed as "bank owned homes," as the home has been repossessed by the bank through the foreclosure process.
Foreclosed home purchases may have longer closing periods and require additional paperwork to release the home from the bank. Homes are often priced below market value, therefore you may find yourself in a multiple-offer situation.