Just a little FYI for everyone... I just got my first rejection on a short sale ! It was a VA loan. The contract gave them 82% of appraised value, but yet the almighty VA wants 88%. I tried to plead my case but it's a No-Go even though the property has been on the market for over 200 days with only one offer!!! Just wanted to give everyone a forewarning...VA needs 88% of appraised value!

Thanks for the heads up. I have a potentially similar situation on the horizon. So far, if they use what I know sales were in this neighborhood, then, I should be able to make it work. When you say appraisal, do you mean a BPO ordered by the VA or a regular appraiser?

Funny that you should ask about the appraisal. The VA sends out their own appraiser that does what is called a "liquidation appraisal". In my case, the appraisal came in a little lower than I expected it too. However, this is before I knew that they want 88%

When we get a rejection due to value with limited options we go back to the buyer's agent and let them know that if the buyer wants this property they will have to pay x amount more than their offer. You can use the VA guideline verbiage and let the agent know their buyer is getting a deal at 88% of apprasied value. We have some buyers that step up and some that don't. If the existing buyer is unwilling or unable you may want to change MLS to reflect buyers can purchase at 88% of value and the new price. Good luck.