I dont think the banks are avoiding short sales or sales on the steps beacuse of tax reasons. (I could be wrong, not a banker) They are doing it because of 2 reasons.
1) They dont have a good idea what the properties are worth either. It isnt like they can just say “sure, that is a fair offer in todays market.” I am sure they need an appraisal, and some comps and more than one person to sign off on that price before they can justify a loss to the internal buracacy. If they didnt, people would be bribing the bank agents left and right (not sayin it would work) and trying to get sweetheart deals. There is a process, and it works traditionally, so they are sticking with it cause they have nowhere else to turn.
2) No one wants to loose money, banks either. If you are hunting them down and buying when they are at their weakest, then the offers are prob real low balls. Plenty of people are still buying, and the bank wants its money back too. Maybe they save money, maybe they dont. But if word gets out about court house sweetheart deals, sales will get even worse, and they will loose even more money. In sports it is akin to the fact that often you know you are gonna lose, but you keep trying to “make a game of it”. It is alot better for the pride (financial statement) to say I lost by 1, then to say I got killed and stopped trying.
