The link at the bottom of this page will take you to the National Board of Realtors® website. They have great advice about buying and selling short-sales. I can add to that from my personal experience.
Unlike many agents, in the past several months I have closed many short-sales with the help of my short-sale team.
Most of the Realtors® I know shy away from short sales. They don't list them and they don't show them. The reasons are simple. Short-Sales are a pain in the behind, and frankly, we don't make much money after we figure in all the expense and time we spend on them. Often we spend a time putting together the offer, corresponding with the lender and the client only to have the buyer get tired of waiting for an answer and move on to another property. The process can take months and I can't blame them when they have their own personal deadlines to meet. I recently had a short sale take 5 months to close!
One thing you have to understand. Banks are overloaded with short-sales and foreclosures and it takes time for your file to float to the top of the stack. Patience is a virtue and you must be very virtuous to play with short-sales.
The Short Sale Bottom Line is...
Buying short-sales are sometimes a great buy! Sometimes lenders plant their feet firm and don't budge on the price. Many times they want the original seller to sign a note for the difference in the amount owed and the amount sold for. Sometimes the seller simply can not do that and the property ends up going to auction anyway. Frustration!
I list a lot of short-sales. My office says I am a glutton for punishment. However, I figure if I can help some unfortunate person unload their house and start a new life without the foreclosure on their credit history - then maybe I may have put a star in my crown.
What the NAR says about Short-Sales...
UPDATE!! Home Affordable Foreclosure Alternatives (HAFA).
In 2009, the Treasury Department introduced the HAFA program to provide a viable option for homeowners who are unable to keep their homes through the existing Home Affordable Modification Program (HAMP). The HAFA program takes effect on April 5, 2010—although some servicers may implement it sooner, if they meet certain requirement--and sunsets on December 31, 2012.