You'll need time and the right temperament to purchase a short sale property, but you could save thousands if you do.

It's no secret that some great real estate deals are out there, thanks to our lagging economy and the housing crisis. Those who are able to purchase right now will likely see a number of properties advertised as "short sale." So, what exactly is a short sale, and is one right for you?

A short sale is...

A short sale means the home owner has made a deal with their lender to sell the property for less than what is owed. This helps the seller by keeping a foreclosure off their credit history and helps the lender by offloading the property faster, and often for a better value, than if the property went into foreclosure.

What a short sale means to a buyer

A short sale can be a great deal for a potential buyer, who can purchase the property at a substantial discount. But, as with all things too-good-to-be-true, you need to do your research, be prepared, and be patient when it comes to the short sale process.

How to have a successful short sale experience

Use an experienced agent. Short sales can be a complicated and sometimes long process. Ask potential agents how many short sales they have successfully completed. If you end up with an inexperienced agent, you probably shouldn't even consider a short sale property.

Tour the property and have it inspected. Short sale properties are sold "as is." The seller can't afford to make any repairs and the lender isn't willing. At the very least, you'll want to tour the property to see what condition it is in and to estimate how much any necessary repairs will cost you. Consider bringing in a professional home inspector for a closer look and repair estimate.

Look at comparables. Yes, you'll be purchasing the property for less than the seller did, but that doesn't necessarily mean you're paying what it's worth. Lenders will typically price short sales close to current market value; but remember, they are trying to recoup as much money as possible out of the deal. Check recent comparable sales in the area to determine if the price is right.

Research all liens on the property. Find out who has liens on the property and if there is another lender with a second mortgage on the property. While not a deal-breaker, multiple lenders could complicate matters. You'll need to determine if you can-or if you want to-take the extra time and deal with the added frustration this situation could cause.

Be patient. Lenders aren't known for their speedy responses when it comes to short sales. It can take three months or more to negotiate a short sale. If you need to move quickly, a short sale isn't right for you.

Don't give up. Negotiating a short sale is like negotiating any other real estate transaction. Your first offer may not be accepted, but that doesn't mean the deal is over. Talk the situation over with your real estate agent and make another offer that you feel is reasonable for the property.

Learn more about what is a short sale and why you might choose a short sale. Terra West Management Services provides expert advice and assistance with our Real Estate Services Division. Give us a call at 702-880-4635.

This article contains general information. Individual financial situations are unique; please, consult your financial advisor or tax attorney before utilizing any of the information contained in this article.

Source: Realtor.org, Bankrate.com, Trulia.com