Can owners do a short sale after they have moved out?

[AC Cooley]

Hi,

I found a vacant house in pre-foreclosure. The lender started the foreclosure process in December 2010. The owners moved out and the lender has secured the property and winterized it. The owners has assumed that the bank has foreclosed since it has been over a year and a half. According to the county records the bank has not foreclosed.

Can the owners still negotiate a short sale or is too late since they have informed the bank they were walking away?

Thanks