The Backup Offer in Real Estate in NYC Explained (2019) | Hauseit®

The Backup Offer in Real Estate in NYC Explained (2019) | Hauseit®


A backup offer is an offer that the seller hasn’t accepted, but is strong enough and close enough to the accepted offer that the seller would like to revisit it should the accepted offer fall through. Neither backup offers nor accepted offers are binding in New York, which means that being a backup offer is really just a nice way of saying that you weren’t the winning bidder. How Often Do Backup Offers Get Accepted? Backup offers don’t usually get accepted in NYC. That’s because listing agents generally do a good job in selecting the highest and most qualified bidder, as well as determining who is serious about buying and who is window shopping. With that said, accepted offers don’t mean anything until contracts have been signed, and offers do fall through all the time. Furthermore, because accepted offers nor backup offers mean anything, a backup offer might still not be around by the time a seller comes crawling back to it. The buyer who is the backup offer may be long gone and have an accepted offer on something else! Additionally, there may be multiple backup offers on a house if there was a bidding war or a best and final offer process. As a result, the chances of one backup offer being accepted are quite low even if the primary accepted offer falls through. Should You Agree to Be a Backup Offer? There’s generally no harm in agreeing to be a backup offer. Since none of it is binding, it doesn’t harm you to agree to this as it’s only option value to you. With that said, you shouldn’t give the listing agent or seller the impression that you are desperately waiting, hat in hand, for them to come back to you. Convince the Seller to Send out a Second Contract You can get a head start over the competition by convincing the seller to send out a second contract so your attorney can begin the contract review and due diligence process in parallel with the accepted offer. Though infrequent, this is sometimes allowed by savvy sellers who understand that accepted offers can fall through, and that there are no rules prohibiting sellers from accepting multiple offers and sending out multiple contracts to different buyers. If you’re able to get the seller to accept your offer as well and send your lawyer a contract, then it’s off to the races. The first accepted offer might have a few days head start on you, so your team will need to move quickly to demonstrate to the seller that they made a good decision in letting you take a crack at it as well. In competitive situations with multiple accepted offers, it’s typical for sellers to expect a signed contract within 5 business days or less. Be careful however and remember that the seller is last to act, meaning they are only bound by a contract after they have counter-signed it. As a result, there is a risk of last minute shopping by the seller, meaning that they could wave your signed contract around to other interested bidders to see if anyone else would like to improve their offer. Thinking of buying or selling in NYC? Save money with Hauseit, New York City’s largest and most trusted For Sale by Owner and Buyer Closing Credit Company. Hauseit has saved New Yorkers millions of dollars in commission since 2014, and we’d love to help you too. Subscribe to our channel and check us out at www.hauseit.com

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