5 caveats for short-sale buyers

Surprise costs could be lurking around corner

Anyone who’s even remotely interested in buying a home these days has heard the term "short sale" — and if the phrase isn’t familiar to you, it ought to be.

Short sales occur when a homeowner is willing to sell his property for less than the amount owed on the mortgage, and the lender agrees to the deal. In many cases, these sales can turn out to be genuine bargains.

It’s the phrase du jour in housing: A recent Zillow.com survey estimated one in five mortgage holders are "under water" — their homes are worth less than the balance on their mortgages. Another study, from the National Association of Realtors, found that one in 10 recent buyers purchased through a short sale.