With current REO sales in jeopardy due to robo-signing investigations of foreclosure affidavits, short sales may be your smartest bet.
The best client protection in a distressed property sale under the current conditions is the optional owner's title insurance. Make sure your client gets it.
Auction ads with "properties must be sold" does not mean all properties; these are reserve auctions. Highest bidder might not get the property. The lender/servicer reserves the right to reject the offer if price is not acceptable.
Agents be careful when a lender/servicer wants you to pay their vendor out of your commission. This could be considered unlicensed actvitiy. Be sure the vendor can legally qualify for a referral fee.
Check my chapter on government auctions. Fannie, Freddie and FHA are covering 97% of the real estate activity in this market.
Mizzer Associates / 410-535-9444 / firstname.lastname@example.org