First time homebuyer: is it better to go with a short sale or regular home?

[Ivan Poon]

I interviewed a couple of real estate agents.

One specializes in short sales and told me she can typically get 20% off the fair market value of a distressed short sale. However, i don't think i'd be able to get the short sale in time to benefit for the 8k tax credit.

Another realtor i interviewed doesn't do short sales but can get about maybe 10% off the FMV price

Can someone check to see if i'm doing the comparison of savings right?

Assumption:

300K home

If i go with the 8k credit, i'll maybe knock off 10% off FMV price (30K) so i'll get a total savings of 8K plus the present value of 30K

If i go with short sale, i might be able to save the present value of 60K (20% off FMV price)

1) Ok so we need to find out the present value of the 30k (the difference between a 20% vs 10% savings off the future value off the FMV of the home) savings at an interest rate of 5.125% over 30 years

According to this website:

http://www.stocktonturner.com/calcs/MortgageLoan.html

the 30K at 5.125% would amount to a total payment of principle and interest of $58802.56 over the life of the loan.

2) To find the present value of that amount i go to this site:

http://www.moneychimp.com/calculator/present_value_calculator.ht...

plugin 58802.56 as the future value, 30 years, and the discount rate of 5.125 to get the present value. I get 13,109.81

3) So it appears if i go with a regular home, i'll save 8K (tax credit) plus 13,109.81 which equals 21109.81 in present value savings

If i go for the short sale, i'll have 26219.62 (13109.81 times 2) in savings, thus i get about 5k extra in savings going with the short sale.

I may also buy as much as 400K in housing, so the higher i go, the more savings i'd get from a short sale.

Did i do this right?