Urgent! please help

I got a property trought Homesearch auction in April.  It was a short sale ( My mistake,not understanding what short sale means).  that was in early April.  However, it wasn't until now the sale was finally approved.  It was a cash deal and I have not enough cash plus the deal is not good any more since the housing market has significantly slowed down now.  I want to cancel it, the property seller want me to pay 3% of the property value as well as $1000 punishment fee.  Is there any way I can get off the contract?  anyone has experience?  please help.