Hello Helene. Those are all very good questions. In my experience, the lenders will not negotiate anything without an offer on the table. They want the most money and there are certain things they will do to determine on their end what they think the property should sell for. Sometimes, you'll see a comment in the MLS that will say something like "approved at this price" which only means that there was an earlier offer that was submitted to the bank and the buyer eventually went away while the bank was in the process of considering the offer.
Unless you have insider connections, you won't be able to get to the ultimate decision makers at the bank. They have their case workers and maybe supervisors, but the actual decision makers simply can't be reached.
I think we all wonder why the banks would rather take the property to foreclosure than accept a short sale and I wish I had the answer to that question. My guess is that there is no real good reason and that's why we are all having such a hard time understanding it. I don't know whether how the bank handles short sale request is subject to anybody's review. While I understand that there are adverse consequences to having too many non-performing loans, I think that alone may just not be enough of a motivating factor for the lenders to handle short sales better and accept them in an effort to save the lender the expense of going through a foreclosure. If I were an investor with a particular lender, I would certainly want to know what is being done to mitigate the damages as much as possible. Perhaps the banks would start paying a little bit more attention to those things if there were an investigation into how effectively they handle short sales. Perhaps John Quinones (co-anchor of Primetime) would like to get involved in exposing bad practices on national television.