It does not mean you have to back up and punt - but it might mean that you have hired the wrong short sale agent to work for you.
Before you get your personals in a bunch - let me explain.
The main motivation of any Experienced Short Sale agent should be the short selling of your home.
Their number one priority should them helping you through a rough process, being your guiding light, helping you focus on the "best possible" outcome.
They should not be those that are undercutting the market in price with regard to your short sale, wanting to work it for leads.
Of course, if they are "spot on" and have experience on the internet with obtaining leads - then those will come. But they won't come because they have taken a $500,000 property and list it for $300,000.
That will only cause you problems with keeping buyers interested because, most real estate buyers cannot climb 200k from where they qualify for.
Most buyers of real estate write offers close to their maximum approved amount. Be this the best thing or the worst thing a buyer can do - it is where a majority of buyers are in today's market.
My advice - interview several agents that talk about being experts in the short sale process. ask around for referrals from people you know.
Don't take for granted that they are all short sale experts. Most will say they are - but few truly are.
See if they have a staff in place, check to find out if they have methods built around short selling properties, and see if they are writing about the process on a blog or by submitting articles.
We do short sales - here is our Short Sale Web Page that will give you access to our short sale articles. Click here for our Short Sale Page and articles