Do REO seller reduce prices to avoid financing?

[Eddie Ziv]

Here is a theory and I love to read some opposing ( or concurring )opinions.
Watching prices of some REOs properties selling in the area of my investing, I notice a substantial drop in asking prices.

I was wondering if REO sellers prefer to reduce prices and sell those properties to cash buyers rather then keep the prices up, wait for finance to go through and get caught up in backed up applications. It seems like processing a loan can take as long as sixty or more days in some cases.

Any thoughts?