I am in Minnesota where we also have a 6 month redemption. Yes, you can do a short sale during the redemptions period. As one bank recently told me, "you get an extra 6 months to get this done".

As mentioned, you should be working with a trained short sale real estate agent as well as an attorney.

Yes, there are major benefits to doing a shortsale vs. foreclosure. Check out this site for some good information.

http://www.shortsalesminnesota.com

Pat,

Short sales for FHA Mortgages must be APPROVED by HUD before the short sale can occur. In many respects, they are easier than a regular short sale, but I do not know the implications of how a sheriff sale affects an FHA short sale.

I recommend you contact a short sale expert in your area, and/or a real estate attorney.

Wishing you well...

Pat if you do not have a real estate agent working with you through the short sale you should really seek legal assistance to get you through the process. Short sales can be very time consuming and in the state of Michigan you have 6 months after the sheriff sale to get the home sold and closed. So you'll need to make sure it is pushed along.

As for the foreclosure it is not a foreclosure until after the redemption is over and that is 6 months. That is one reason many people choose to do a short sale because although your credit is effected it is not a foreclosure.

As I said above you really should not be signing without assistance from a professional.

Pat,

You have some very serious concerns and you should seek legal advise.