Well long story short it was an automated process that relists the property automatically when people back out of a sale, it relists it automatically on trulia, yahoo real estate, etc and just drops the price 5k on it's own.
Which is fine. We placed our bid and it got accepted! Though they wouldn't take a USDA loan, even though both WE and the property qualified, we had to go FHA. I don't even care, just thrilled that we got it! Thanks for all the advice!