BK Dilemna Over Short Sale

Hello Board

I am in a dilemna again, I worked a deal a long time and finally right before sale the bank rejected my offer. At that point my homeowner filed for a BK on the day of sale. My dilemna is that the bank rejected the offer based on percieved value of a higher return on selling the property then shorting the note. I was wondering whether I can now make a new offer since the threat of BK has held up the sale a little longer and the market has dropped and the property based on the appraisal has lost 150k$ in equity in the last few months time frame.

" What and how would you handle this predicament?"

Thanks for your patience

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