They take possession of the property in foreclosure. 

My wife an i are just closing on a property in Truckee, we intend to move into the property in ~2 years.

Whether it's about deals, property management, or anything in between, I'm all in for a good conversation!

One option is I can cash out refi one property that has $400k in equity. 

If you rehab a house in one of the neighborhoods you're considering will it be surrounded by other abandoned distressed properties or are these abandoned properties located in decent neighborhoods that people will want to live? 

If you live in the property for at least two years, you can sell it without paying ANY capital gains tax (unlike traditional flipping).We've done this a few times, but almost every time, we end up keeping the home as a rental.

My wife became a realtor in March & I recently jumped on as the business development manager of a long-term property management company.

I dont have experience buying but have looked into it, from what I can tell, if you buy it at a tax auction, The owner has a certain amount of time to reclaim the property.

Lilburn is along the same lines as what I noted above, your acquisition budget needs to be at least around $300k (maybe high 200s) unless the property is distressed.

You can do a quick search to bring up a few options that might fit with your property's location and your budget.