You should know that banks are not required to disclose defects in the property in the same detail that regular sellers are because they have not lived in the home. It's important to get an expert home inspection to look for expensive flaws. If you are in a competitive bidding situation, you may be able to get a "pre-inspection." This inspection is conducted before you make your offer, and will help you decide if the place is in good enough shape to make an offer at all.
Nearly all bank-owned properties are listed on an as-is basis. That means the bank is stating it will not repair defects to the property. If you find flaws, you should mark your offer down accordingly. Alternatively, if the property has been sitting around for awhile, even though the bank has listed it "as is," it may be able to pay for repairs in order to get the home off of its books.
It's best to approach any home purchase with your own preapproved financing in place, but since you are dealing with a bank, it is quite possible that they will want you to get preapproved by their own mortgage department as well. Some banks selling properties will actually offer to provide you a mortgage for a property. It's a fine idea, as long as you have shopped around elsewhere and know you are getting a good rate and fees.