Who is your Realtor? What do they say?
In some REO situations they think they are immune from normal real estate law. Your Realtor works for a broker, who should have some input. There are substantial risks to proceeding in a transaction without proper seller signatures and every office has their own policies.
In some cases you might see something like "seller will not sign" but in most cases they have to sign. This is the type of question that needs advice from a person tied to the transaction, and perhaps even legal counsel.
But in all REOs that I have recently seen, fully executed contracts and counter offers are necessary for our escrows to begin and files close. So I would be very leary of this and I would speak with the agent's broker about the matter.
The bottom line is ...to move forward without necessary signatures is to do so with significant risk involved. We agree with Kieth that considerable effort should be taken to resolve this ASAP before moving on.
The "Eckler Team"