Both players are off contract at the end of this season, though their deals do include a 12-month option.
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However, The Sun says United have decided against taking up the option and will allow both players to run down their deals this season.
Sancho is currently on-loan with Aston Villa and hopes to use his time at Villa Park to put himself in the shop window.
Also set to be released is fullback Tyrell Malacia, who is also off contract in June.