For agents, look up Rule 120 which indicates the Status should be Pending or Pending BU and NOT actively for sale.
Legal Bulletin 169 addresses Short Sales. In particular it states in section 5
5. Rule 120. Rule 120 requires the listing office to give notice of sale by changing the status of the property after a purchase and sale agreement is executed. The existence of a right to review the agreement by the lender does not affect this obligation. A contingency allowing the lender to review the agreement is no different than any other agreement, and if the parties have reached mutual acceptance, the property is under contract. The status must be changed to Pending, or Pending BU no later than 5:00 p.m. of the next business day.
Hence if a Short Sale listing has a signed P&S agreement waiting on Lender approval then this listing must be changed to either Pending or Pending BU by 5.00pm the next day.
Thanks for the question.
Windermere RE South Inc.
Listing Office Duties. The listing office must give notice of sale to NWMLS on NWMLS Status Report Form on all listings in NWMLS. Notice must be delivered to NWMLSâ€™s office or be input by the listing office not later than 5:00 PM of the next business day following receipt of the copy of the Purchase and Sale Agreement from the selling office. The listing office may, in its discretion, give such notice following the telephone notice from the selling office without awaiting receipt of the Purchase and Sale Agreement. Notice of sale and notice of sale subject to inspection (â€œSTIâ€) must be input or delivered to NWMLS within the above time limit. Listings sold â€œSTIâ€ will remain active in NWMLSâ€™s database until the condition is satisfied or waived, at which time the listing office must input the listing as â€œpendingâ€ by 5:00 PM of the following business day.
A seller has the legal right to continue to market their property, but cannot legally enter into two contracts, since he/she only has one property to sell. Many sellers do continue to market for back up and fully disclose that showings are for back up purposes. In particular, if there is a sale contingency, a buyer has failed to deliver deposits or mortgage approvals, you will see sellers continue to market. In the case of a short sale, has the lender approved the contract? If not, the seller will most likely continue to market and search for back ups. With a short sale, a buyer and seller can sign, but the third party approval is needed to make the contract binidng.
The new short sale MLS rules just started so I assume there will be some adjustment. The appropriate status according to the new rule on short sales is "pending - BU". (as in back up). You can always call the MLS and ask them to enforce the rule.