Best of luck,
Until the bank has actually completed the process of foreclosure though they cannot accept a contract without the homeowner first accepting an offer.
They list their home with a good broker who gets everything into the bank to get the short sale approved. Then, for what ever reason, John and Mary decide not to sell. That is their choice. Maybe they were current with payments all along and decided to keep making the payments. Maybe they have a family member who is willing to help them out. Maybe they are going to try to modify for the 5th time. There are 100s of possiblities. It is still their home.
I suggest you cut your losses and move on. There are tons of houses on the market. You don't need to have the homebuying experience squashed by a confused seller! It's supposed to be fun. Usually when this happens, you turn the corner and find a better deal!
Your question is a very good one indeed. The current real estate market has created lots of confusion and frustration for buyers, sellers, realtors and lenders as everyone tries to navigate through the process. I can understand your frustration and desire to purchase this home, or another only to encounter a situation such as this. Many sellers have tried in vain to get their banks to make much needed modifications to their home loans, and in many cases the process takes longer than owners wish. It is entirely possible that the owner of the home you are inquirying about had exhausted all avenues with no results and placed their home on the market, only to find that now their lender may be willing to assist them in staying in their home. If that is the case, then the owner should remove the home from the market until they know the results of this current request.
Unfortunately, because the owners do still legally own the home, the lender will not and can not negotiate directly with you, nor can they tell you the current status of the forclosure or modification status. Should the bank proceed forward and foreclose on the home, then once that process is complete you would have the oppotunity to make and offer ont he house.
Good Luck in your home search.
Until the house is foreclosed on and the bank owns it, the owners/sellers can do whatever they want. The bank doesn't own the house yet so you going 'past' them will do no good. The first step in a short sale is getting the owner's/seller's acceptance and then the lender/investor. The lender/investor cannot sell the house to you (accept your offer) without the acceptance of the owner/seller - it is still their house until foreclosed upon.
Absolutely...the owner can and should do whatever possible to maintain ownership of the home and assume their responsibility to their lender. Until the property is actually foreclosed on and the lender takes ownership, the owner can choose the fate of the home without the bank's involvement.
If the lender is willing to work with the owner, do you really think they will seriously consider your plan of having them foreclose and likely suffer greater loss, all for the sake of making you a deal?