Short sales have been a constant frustration of Realtors, buyers and even sellers for a long time.  I am sure there are more than 5 reasons to not buy a short sale, but I figured these were the biggies!

1. Unknown Length of Time: Short sales generally can take months from accepted offer till closing.  Plus, there is really no solid time line as to when the closing will occur.  Do not make plans to move around the date on the purchase agreement, it doesn’t mean anything to the bank!
2. Deal May Never Close: I have seen many short sales that never get approved by the bank and consequently go into foreclosure, despite having an accepted purchase agreement.  This is usually a result of the bank taking their time or a disorganized/inexperienced listing agent.
3. Price on Purchase Agreement May Not be Accepted by Bank: Although the seller has accepted your offer, there is no guarantee the bank will.  You could get the offer accepted for $100,000 only to have the bank come back and say they will only accept $125,000.  Your only options are to accept $125,000 or to cancel the deal.
4. Little or No Information Prior to Closing:  This is related to #1 above.  This can be one of the more frustrating parts of the process.  The listing agent will often have no information as to what is currently happening on a short sale deal for weeks on end.
5. Last Minute Deal Thieves: Just like on eBay, unless the listing agent is explicitly preventing it, you could have an accepted offer in on a property for months, only to lose it in the last 30 days to a higher bid.  While I know the 2nd buyer is not maliciously taking the property from you, the listing agent is doing you a disservice by taking a later offer, regardless of the fact it is higher.

These are just a couple quick problems to watch for when buying a short sale.  The best advice I can give someone is to not get attached to the house until you get the keys in your hand, after closing.