Short sales, where the lender accepts less than they are owed for the property, has always been an interesting undertaking. To begin with, there are mountains of paperwork. Then the challenge of potential multiple lien holders.
It appears the current MO on properties with multiple liens is to reject all offers, strip the 2nd, 3rd, etc. off in the foreclosure, and take as much of the profit in the REO sale as possible.
When evaluating a property for a client, I look to identify multiple lien holders and educate them on the potential for a no-sale. It’s easier to find a motivated seller or a bank owned property.