My city seems to bid the land banks but I’m planning on reaching out to get educated on how the system works. 

But aren't you at risk that it sells for the minimum bid of $67,000, all that goes to the taxing entity and you get wiped out? 

I think an auction could be a good way to go, as I haven't even gotten a low bid offer at this point having it listed.  

Get a bunch of bids and make a decision if its worth it.The line looks dry, why is that?

Consider factors of what the property will need though if needs work (account for that, do an inspection, have contractors give you a bid on what all could or needs to be done).

I know the house needs alot of work, so I was hoping to make a rehab budget and then develop a rehab cost number which I will use to develop a bid to see if I can get the house at a reduced price since it needs work.

Which you can also try if you win with your super low bid. 

@Owen RosenI did when the damage first happened, but I'm thinking maybe I should again to see what they think about how to proceed with the 2 bids.

I've had several bids, all much higher than the original, unrealistically low contract price, with of course a lot of variety in the price, experience, and track record of various builders.

Once you know the answers to the questions above, you can better evaluate bids you receive.