She had another realtor refuse to write her offer, saying she was "wasting his time" with an offer that low ($10k under asking price, less than 10% reduction) and she checked the tax records after the sale and it sold for less than her offer.

John I have heard that argument many times and it is misinformed.First many attorneys are per hour and bleed you dry in the end.It's there operating structure to start low and keep billing and billing.Second the seller commission agreement is spelled out in the listing agreement.The listing agreement usually says selling broker to share a co-op of XX with the selling broker.If it is not shared then by the agreement the full commission goes to the selling broker.Usually the listing agent if they are not the principal broker owner are working on behalf of the main broker.So the listing agent does not have the authority to reduce their own commission.For example if a listing agent was to make both ends at 6% it could spell any reduction in commission will come off of their end.So I as a broker have an agent on a 50/50 split.100,000 sales price at 6% = 6,000 commission.The agent wants to reduce to 4% to get the deal to go through.In my independant contractor agreement I have them sign the split will be based off the total commission agreement before any discounts.In this case I would base it off of 6,000 getting half or 3,000 leaving the listing agent 1,000 before there expenses.In this case they would almost be working for free.John the seller has to pay the total amount of commission agreed to in the contract.We even have protection periods built in where we are still owed a commission if the seller tries to terminate unless they sign with another broker.This eliminates all the wait until it expires or say you have taken it off the market and we will do a back door deal.This is the number one mistake investors and buyers make.Broker and agents who do business this is not our first rodeo.We have seen all the schemes and ploys by buyers.I believe if buyers spent half the time getting their affairs in order to be able to purchase instead of trying to figure out how to screw a broker/agent they would get much further ahead.Smart investors do not even mention commission to listing agents.They just want the deal and say "thank you!"

I'd do the same thing, except I'd probably try to get price reductions on the stale listings.

Principal reduction and recast the loan.

The last price reduction is 3 months ago.  

They get paid 40% of the tax reduction (if they reduce my tax burden from 4000 to 3000, then they would get $400 - 40% of $1000).  

Thats basic an interest only loan in terms of the amounts they'd receive and then they'd have to go through the headache of dealing with principal reduction calculations every month.I would bet that a private lender is either going to do interest only or 30yrs tops.If they won't budge on rate and they won't budge on price, then its simply not a good deal.

It wouldn't be a total deal killer, but an obvious price reduction.  

Dont feel bad about a price reduction at all. 

It's been up for 3 months so far even with a price reduction.