First I do not know whether you are looking to sell or buy.I have assisted with many short sales. From the buyers perspective you must asses the value and make an offer to the lending institution prior to the process of foreclosure.You need to know that the home-owner is struggling before they go into foreclosure.You then negotiate the price with the lender and the seller. getting the lender to take less than the seller owes.Most generally this is only accomplished if the seller owes more than the property is worth.You will need cash or a verified line of credit as the lender will not likely loan on the same property again.I have linked to an article below that is pretty complete.Single family is harder as it is a smaller portion of the total assets of the lender. Large multi-family and commercial is easier because the lender is out so much money and they are restricted in how much they can loan based on the amount of bad loans they have. Federal law restricts lending institutions from lending more than a certain percentage of good assets.Often in larger acquisitions you can expect to purchase for as much as 20% less than owed.Occasionally more depending on the properties condition and other facts. ------
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