Cannot believe this actually happened!

Found a property that means my client's criteria, except it is being offered as a pre-foreclosure / short sale. The listing price ob the property is $105,000, which is way below the market value (on the tax role the value is $165,000) and its only been on the market for 3-days.

After explaining the process of buying a pre-foreclosure / short sale, my client's still wanted to make an offer. So I contacted the listing agent and he stated he had over 20-offers on the property. So I stated this to my clients and they said they at this time only wanted to offer the asking price. So, I submitted an offer at $105,000 cash, with proof of funds.

So, after waiting for over 5-days, I followed up with my clients and explained I haven't heard anything and recommended that we step up the offer (but still make it a win/win for each party). So, we ended up submitting an offer for $145,000 Cash with proof of funds and not asking for any seller concession or anything else.

I finally was able to get a hold of the listing agent and I cannot believe my ears. He stated that we lost the deal to a LOWER OFFER ($105,000)! His explanation was the lender / seller didn't want the new buyer to be upside down in the purchase, so I explained to him to look at my first offer and make me a hero.

Now I ask you? How is this Realtor representing the best interest of either party (lender or owner)?

This house was built and purchase in 2004, with an estimated loan amount of $165,000 and a balance of $159,000.

If this agent advised his clients to accept the lower offer, this would mean the lender takes an estimated $54,000 lost and the owner no doubt would need to carry some of the difference in lost...

*** WOW ***