Courthouse. In my state, they're generally both legal actions, so, off to the courthouse you go. The 'court ordered auction' here is a Sheriff's Sale, something which is handled much differently in different states. If you're interested, I'd start snooping around the legal docos of the courthouse, attend some of the auctions, then spend some money and time getting the details from a competent RE attorney as to how the system works IN YOUR AREA.

Thanks a lot, jasonmi7. I am going to search online for the courthouse information. I am in MI area, I wish I will get a good deal on a house I like in 2007. :)
BTW, is it possible for me to know the owners who are pre-foreclosure? thanks again!

In Colorado when my sister's home was foreclosed on she said they listed Sheriff's sales of foreclosed property in the newspaper. Like Jason says, each area will be different. you could probably find out this information from a realtor in your area, they may also know of homes that are in a pre-foreclosure process. I've heard that quite often it's easier to purchase these homes before they go back to the bank and that often they offer a very good deal so as not to have a foreclosure on their credit.

Thanks a lot, cordovamom. I'll check with our realtor about the information too. :)

It depends on where you live. For us it's real easy, it's published weekly.

Here is a link that might be useful: County Public Trustee

Yes; sometimes you can get the house from the bank before it goes to auction; that's a short sale, but the owners (in Michigan), have to agree to this transaction because they have (here), a period after foreclosure to get their property back. Realtors are good, but again, before laying down any money, I'd consult an attorney; the foreclosure/sheriff's sale deeds/actions can be quite complicated and you need to know your rights (as well as the rights of everyone else).

In PA, we got a court order against my brother to put the homestead (which he stole) up for sheriff's sale. The sherriff has to publish forthcoming sales for 30 days. In our town where auctions are held, they are held on the same day each month. However, my brother filed for bankruptcy the day before the auction and the house is still tied up. The sheriff told us that 75% of the foreclosures go into bankruptcy the day before the pending sale.

Just be aware that this is one of the techniques taught in real estate seminars and that zillions of people are looking for foreclosures. It's a valid idea, but often not as simple as it sounds. In fact, my realtor told me that over the most recent two-year period she had spent many hours researching foreclosures, and never once did she get one at a reasonable price. Too many equally savvy people were on the scent...

You could make a lot of money buying foreclosures if the people lived in their homes a long time and had a great deal of equity and went into foreclosure just after they paid their property taxes. But thats not who goes into foreclosure--its mostly people who have refinanced and also taken equity lines so there isn't much of an equity cushion.
The really big money in foreclosures is teaching the seminars. Be careful also because there are scams that involve "investors" buying foreclosures and letting the foreclosees live there.