For those who do not know, a short sale is a sale in which the sales price is less than the amount that the seller owes on the home.  The seller is therefore requesting that their lender(s) forgive the deficient amount.  Here are a few things to consider whether you are a buyer or seller:

Sellers:

* You need to contact a real estate professional to assist you with the sale who knows how the process works and can help you put together a short sale package.

* Gather all of your financial documents and draft a financial hardship letter.

* Prepare for what could be a long wait for bank approval once you have accepted a buyer's offer.  

* Realize that although a short sale will not damage your credit to the extent that a foreclosure would, it will still negatively affect your credit.

Buyers:

*  Choose a real estate professional who has experience working with short sales.

* You may be responsible for any repairs required by your lender since the sellers are likely low on cash.  If the home is vacant, you may have to have utilities turned on for inspection.

*Be prepared for a long wait for response from seller's lender.  A short sale might not be for you if you need to be in a new home in 6 weeks.