What Is a Backup Offer? Why it should be considered in a competitive market, but not relied upon
Imagine you’ve found a perfect house and made an offer, only to find out later that there is another offer on the table. What do you do? Here’s where a backup offer comes in handy.
A backup offer is a second offer made on a property that’s already under contract with another buyer. Essentially, it’s a “Plan B” just in case the first contract falls through. Backup offers are not always accepted but are used as a safety net for sellers, as they give them a potential buyer lined up in case something goes wrong.
The beauty of backup offers is that they don’t cost the buyer anything; the only time the buyer is involved financially is when the first contract falls through and their backup offer is accepted. At that point, they would be liable for earnest money and any associated closing costs. The downside of backup offers is that they may never come into fruition. The primary contract may close as intended, leaving the backup buyer without a home. But should you decide to submit a backup offer, it’s essential to make your offer as competitive as possible.
The backup offer should be at or above the original offer price, with as few contingencies as possible. It’s also crucial to let the seller know that you understand the situation and are willing to be patient while waiting for the primary contract to fall through.
Backup offers can be a great way to potentially secure a home that you’ve fallen in love with. They offer a safety net for sellers and can benefit buyers in case something goes wrong with the primary contract. When considering submitting a backup offer, it’s always a good idea to have an experienced real estate agent guide you through the process. They can help you submit a competitive offer and offer guidance on whether a backup offer is worth your time and effort.
Give us a call! Mick Khzouz & Nicole Diatto Michigan Rockstar Realty Powered by: Clients First, Realtors Phone: 734.748.8882 Office: 43050 Ford Rd Ste 130, Canton, MI 48187