As a Northern Virginia Short Sale Listing Agent, I am finding more and more Buyers Agents puzzled to the Short Sale process, and confusing their Buyers as a result. In order to understand a Northern Virginia Short Sale, let me lay out two of the ground rules that all parties must realize. The first is universal to Short Sales. The second is a condition of the Multiple Listing Service (MLS) that serves Northern Virginia.
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The seller in a Short Sale is the owner, not the bank. The bank only becomes the seller after foreclosure.
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When a contract is Ratified, the property status in the MLS must be changed from Active to Contingent.
As a result of the second item, unique to Northern Virginia, once a ratified contract is in place and the status of the property in the MLS is changed, it is highly unlikely that any additional offers will be made on the property. So as a Northern Virginia Short Sale Listing Agent it is my job to make sure that, before my Sellers commit to signing an offer, that they have just as 
committed Buyers on the other end. This often means countering with the condition that the Earnest Money be deposited at Ratification, NOT Short Sale Approval.
For beginners, Buyer's Agents don't get the concept of a counter offer. That's easy . Refer to item number one above. So now to the real issue. Why insist that the Earnest Money be deposited at Ratification?
It's simple. If Buyers are not putting their money where their mouth is, they are effectively asking for an OPTION to purchase the Short Sale property. Without the financial consideration, there is nothing tying the Buyer to the transaction. In fact, it is commonplace for Northern Virginia Buyers to continue to house hunt after contract ratification. And if they find something they like better, or can get into quicker, there is nothing tying the Buyers to the ratified Short Sale Contract. Meanwhile, the Sellers will be left high and dry having lost time on the market and needing to start the entire process over. (Refer to number two above.)
For whatever reason, this logic dumbfounds Northern Virginia Buyers Agents. And yet, if as a Short Sale Listing Agent, I asked these Buyers Agents, "Is it okay if my Sellers submit multiple ratified contracts, and encourage higher and better offers than yours?" the natural response is, "Of course not!" In fact, one Buyer's Agent I spoke with in the last week regarding the one sided nature of his Buyer's offer said, "Well, the Buyers are willing to purchase your listing if you can get it done fast. They just don't want to be tied to the transaction if it drags out."
That statement perfectly crystalizes the mentality of a Buyer wanting an Exclusive OPTION to Purchase. Without the earnest money on the line, there is zero buyer commitment. So pardon me if I continue to serve the best interests of my Short Sale Sellers by looking for Buyers who are willing to put their money where their mouth is, while my Sellers and I follow the rules of the Northern Virginia MLS. If you want the listing marked as contingent and essentially, off the market, deposit the check at ratification.
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