It seems that everyone is confirming that an Urban Legend 3 is definitely in the works, which is very good news for all of us fans out here! Although I am still waiting for an official response and confirmation from Sony, here's what website VideoETA.com had to say:
"Do you remember that legend about the movie that kept coming back and back for more even though the first movie was the only original movie in the bunch? Well, don't worry, because if you don't, it's because it was only an "Urban Legend," or was it? The series that just won't end, appears to be coming back for a third installment (aren't they all these days?) The lead female survivor from the second movie (Jennifer Morrison) has agreed to come back for "Urban Legend 3." So much for "Final Cut," eh? As you'll recall from the first two movies, both killers are still very much alive. And given the "Hitchcock ending" of the second movie, apparently they're working together now. The plot supposedly revolves around the surviving cast members of the first two movies coming together and being hunted by the team of killers."
It seems completely unanimous in the movie world that an Urban Legend 3 really IS going to happen, despite doubts among skeptics! Not bad, I say!