What makes an investor decide to make the investment prior to actual foreclosure while some others make the investment at a foreclosure auction?

Investing in foreclosure can be made at different stages:
Pre-foreclosure. This involves negotiating with the homeowner and most of the time, they are just forced to sell the house to stop the foreclosure, maintain a good credit slate and get remaining money from the property.

Foreclosure Auction. At the auction, if the property is hot, the amount the investor needs to buy the house could rise high that the homebuyer can not buy the house anymore. This happens because there are higher bidders during the auction.

Negotiation with the bank to buy the real estate owned property (REO). This is likely to happen when during the auction there are no interested bidders. This happens because the minimum bid was too high for the bidder to appreciate the house.

So when is it best to buy a foreclosed or about to be foreclosed house? It is best to sit down with an experienced real estate agent, who can discuss the implication of buying or investing in foreclosure.