Parts I and II of this article series detailed two mistakes to avoid when making a short sale. The first is not to believe that short sales are quick and easy. The second is to remember that banks do not lose money on short sales.

Now Part III tackles the final three mistakes you need to avoid when making a short sale.

Bogus Belief #3: Seller bankruptcy stops foreclosure.

Many sellers seem to believe that if they declare bankruptcy, the lender can't foreclose, allowing them to stay in the property forever without paying.

As the investor, this bogus belief makes trying to convince the seller to cooperate in a short sale difficult. Why would they want to sell if they think they can live free forever?

So it