There are several different types of bank repos but they all have a very common element.  Someone could not pay their mortgage payments. 

 When an owner of a home falls behind in payments to the bank or owner of the secured note, an attempt to mitigate the end result of foreclosure begins.  In the event, an owner cannot comply with the terms of repayment for the late debt owed, the bank or owner of the secured note initiates the foreclosure process.  

This process may  take 120 days, sometimes longer.  At the end of this period the bank typically ends up with the home that was used as security for the note signed by the previous owner.  At this time the home is a bank repo.

In the case of a home with an FHA loan it becomes a HUD home.  If the home had a VA loan it becomes a VA repo.  These are government repos that have a well defined disposition process.  These homes will very in condition and will always be sold in their current condition.  A real estate broker must assist you in accessing the home as well as submitting your bid to HUD or VA.

In the event the home was secured with a conventional loan, there are many different types of sellers.  Sellers may be the bank themselves, Fannie Mae or Freddie Mac (loan purchasers), mortgage insurance companies, or third party companies that specialize in disposition for banks and secured note holders that do not have departments to handle bank repos. 

Some of these secured note holders may be investment firms, pension plans, and insurance companies.   These types of bank repos differ from HUD and VA.  These bank repos are sold in their current condition or may be repaired prior to sale.  Banks now look at the sale of repos as a way to recoup some of their losses or possibly profit by repairing a property to sale at a retail price in the marketplace. 

Real estate brokers are the best source for access to bank repos as most of them are listed with real estate companies to reach the mass buying market.