All short sales must be bank approved. In this case, you have made an offer, rejected a counter offer, and made your own counter offer. The ball is in the seller's bank's court. You can either wait it out - and be prepared for a long wait - or withdraw your counter offer and walk away. Short sales are notoriously time consuming - with no definite timeline. If you are in no hurry and think the offer is a good one, I would wait it out.