“A short sale is a sale of real estate in which the net proceeds from selling the property will fall short of the debts secured by liens against the property.
In this case, if all lien holders agree to accept less than the amount owed on the debt, a sale of the property can be accomplished.” – Wikipedia
Buyers can use an online database, such as a Multiple Listing Service, or consult real estate professionals who have experience in short sale transactions. Aside from “short sale,” some key phrases to look for are “subject to bank approval,” “preforeclosure,” “third-party review required,” and “pre-approved by bank” which may indicate that the property is being sold on a short sale. –Freddie Mac