You will absolutely need to be pre approved. This looks like an amazing property. There will more than likely be other buyers interested in purchasing this property as well. Without pre approval you will not fair well when there are other buyers that are ready to make a bid or have a written offer in hand with a pre approved letter from a bank. Also, there are many "cash" buyers that seem to fair better in a situation like this, simply because they have cash in hand and can close in or less that 30 days! The important thing to remember is have an experienced agent that understands how to present an offer on a short sale or foreclosure; remember that a clean contract ( without a lot of contingencies will hold more weight that a contract full of inspections and financial contingencies. This not to be compared to your arms length transaction. This is a short sale. Be prepared to wait as many times banks will ask a very low price just to pull in offers and then reject them all and and raise the price. They are testing the market! If there is not alot of interest and not very many buyers, you have better chance of attaining the property. It is not unusual to have 10-20 offers on the same short sale property. Put yourself in the position of the lender; they want the most amount of $$$$ that they can possibly recover for this property. The seller really does not have much to say any more other than signing off of the house and making sure that the offer is legitimate and acceptable to pass on to the lender. To answer your question absolutely you need either proof of funds or absolute proof of lender approval and use a bank rather than a morgage company. I know this is not fair but unfortunately, a bank wants to deal for the most part only with another bank! I hope this helps and you have good representation. I would be happy to assist you.