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Counteroffers & Multiple
Offers When you make an offer on a home and you’re in
competition with other buyers, there are several possible outcomes.
Your offer could be accepted or it could be rejected.
The might counter you offer, in either primary position, or in a backup
position.
Making counteroffers is very common in real
estate transactions. You as an agent will serve as go-between.
Counteroffers are replies to original offers (as
the name implies). For example, the
buyer asks that you leave the washer and the dryer with the house.
You decline and counter back to the buyer with the washer and dryer
marked off the personal property section of the contract.
You have made a counter offer.
A counteroffer is an entirely new offer, one that
the buyer or seller doesn’t have to accept.
Any change, no matter how minor, voids the first offer, and the buyer or
seller is under no legal obligation to respond to the new offer.
This means that even though the buyer first offered to pay full-price (in
cash) for the house, you have just killed the sale because you balked at leaving
the washer and dryer worth $200.00.
There’s an additional point to understand
regarding offers of all kinds (counter or otherwise):
The offeror, the person making the offer, has the right to withdraw the
offer prior to it being accepted with that acceptance being communicated back to
the offer. This means that a buyer
could withdraw the offer (with earnest money being returned) anytime prior to
receiving word from you that you have accepted the offer. Make
sure you weight the pros and cons before proceeding and be ready to accept the
consequences.
In general, win/win negotiating will take you a
long way in making and accepting counter offers.
If you keep the other party’s position in mind when negotiating,
meeting the buyer or seller half way will be easier to do and more productive as
well.
Once the buyer or the seller agrees on terms and
accepts the counteroffer, you have a binding contract.
Sellers who are blessed with offers from more
than one buyer will usually counter one offer at a time.
A typical scenario might go like this.
If one offer is far superior to the other, the seller will work with this
offer first. Or, with multiple offers received at the same time, for competition
and fairness, the seller will notify each buyer of multiple offers and to submit
a “best and final” offer to be considered at the same time as the others.
The seller must only counteroffer one offer at a time. You may negotiate
and accept a 2nd offer as a “back up contract”. Some buyers
suffer buyer’s remorse soon after acceptance when they realize they bid higher
than they should have. If the
primary buyers back out, and you’re in first backup position, your offer will
be elevated to primary position. You’ll
avoid having to go through another bidding contest.
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Disclosure
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