Property back on market during short sale process

[Behrooz K.]

Hi Everyone, 

Couple of months ago I got involved in a short sale. The broker gave us a BPO of $140k. Suggested I bid 120. I bid 110. Couple months later the bank came back with their appraisal of 170. Broker said their original BPO was probably wrong and the bank's appraisal is more accurate and suggested I bid 150. I went down 20% from 170 and bid 136. The broker said he'll see. A week later I see the property back on the market. When I asked the broker why that is he said the bank has asked that they take back up offers, however they deal with one offer at a time. He also said he feels my bid is too low and that I need to come up with a better offer. Is this legit, can he do this? Any comments and suggestions are welcomed. 

[Behrooz K.]

@Christopher Phillips Yes, we did sign a contract with seller two months back. Then after a month the bank requested additional information from the seller. Then another month passed and they finally did an appraisal. My broker requested I increase my initial offer which I did. Now he is asking me to raise it again, even though the bank hasn't yet rejected the previous offer. So I'm increasing my offer to 15% under appraised. I hope that's close enough. 

@Wayne Brooks Right. My broker said we work one offer at a time. But he also said the bank has asked us to look for back up offers. His words exactly.