In general, a sale of a home is subject to existing liens and your lease constitutes a lien against the property. So, a buyer of a short sale home takes the home subject to the lease and your rights under the Lease, unless your lease provides otherwise.
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I understand that your initial 6 month lease had an option to renew for another 6 months, if you paid an extra $25. However, I don't know if the $25 was the option fee or an additional monthly increase. This would make a difference. If it was a fee to exercise the option, then the burden was on you to pay it in order to exercise the option. Otherwise, the terms of the original lease would likely dictate the nature and ability to exercise the option.
In any event, since you appear to be in a month to month, a 30 day written notice would likely be required under a transfer by Trustee Sale. With a short sale approval, you should still have a 30 day written notice from the landlord.