Do I want to make a backup offer on behalf of a buyer?
South Boston Condos for Sale and Apartments for Rent
Do I want to make a backup offer on behalf of a buyer?
No to both.
The choices? Pending, Contingent, Continue to Show, and Active Under Contract.
While there are probably definitions for each, they aren’t easily found or enforced.
When a listing is marked Pending, I figure they have a deal and swipe to other listings.
But when a listing is marked Contingent, Continue to Show, or Active Under Contract, then other agents can assume that they might be able to bring in their non-contingent buyer and bump the existing deal.
Should I make a backup offer?
Pro: Might get lucky and be in the right place at the right time.
Con: My Boston condo buyers get excited that they might have a shot at buying that one, and lose motivation to look at others until notified that the first deal is going to stick.
I’m not going to pursue it. I don’t want my buyers to get their hopes up.
How about when I represent Boston condo sellers?
I only get them into a contingent deal if I have great certainty that the buyer will make it to the finish line, which means they at least already have a buyer for their home and are in escrow. I don’t want to get into an agreement until then – go find a buyer for your house and come back to me!
What if a non-contingent buyer comes along? It’s unlikely to happen because the listing isn’t marked as an active listing any more so I’ll take my chances that I’m not going to end up with egg on my face if this contingent deal cancels on me. But I better be sure that I’m confident it will stick!
So I don’t like backup offers whether I am representing the Boston condo buyer or Boston condo seller
What are Boston condo back up offers?
It’s no secret that the downtown Boston condo for sale market is currently experiencing a strong seller’s market. Yet even in this competitive environment, almost nationally 25% of all escrows fall through before closing. Home inspections, appraisal surprises, and rising interest mortgage rates are just a few of the issues which can arise, causing the Boston for sale buyer to pull out of the deal.
What is a Boston condo backup offer?
A backup offer means that another buyer is willing to step in and close if escrow falls through. As you consider a backup offer, here are 4 things you need to know:
A Boston condo backup offer is legally binding.
A backup offer is a fully executed offer, just like the original, so make sure the terms are acceptable. Typically, the buyer will include a contingency in the event they find another home.
Multiple Boston condo Back-Up Offers.
In a strong seller’s market, it is not unusual to accept multiple backup offers. Always clarify the position of each backup offer and whether you will continue to accept backup offers.
Boston condo Leverage
Back-up offers provide leverage during the escrow period as well as security for the seller. Use backup offers to discourage unreasonable requests for repairs or concessions during escrow.
Boston Condo Earnest Money.
Back-up offers do require the buyer to submit earnest money, just like the primary offer. This stays in an escrow account. Often this is smaller than a typical deposit with the condition to increase the amount if the offer becomes the primary one.
Boston Condos for Sale and the Bottom Line
Backup offers are an important consideration in any home sale. Not only do they protect the seller if an escrow fails to close, but the buyer can also have another opportunity to close on a home they love.
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