My buyer got some great news today! His back up offer has now been accepted and entered into escrow. He is a happy man.
It is common for a good listing to attract multiple offers. Only one person can buy the home, so what happens to the rest of the bidders?
Most listing agents will ask one of the other buyers to be the “back up offer”. Think of this as “first runner up”. If anything happens to the first buyer, the back up automatically steps to the plate as the new buyer.
If you are that buyer, would you accept back up position?
In my opinion you have nothing to lose. It is basically a one way obligation- the seller has to sell to you if the first buyer falls, but you are free to continue looking for another home. Since escrows fall apart about 30% of the time, you have a reasonable chance of buying the home. I’ve had 3 buyers get the home of their dreams on a back up, this year, alone.
Now, some might say, “the seller will use my back up offer as leverage to make the first buyers perform”.
My question to you, is, why do you care? The first buyer is either going to buy the house or they won’t. The presence of your offer merely affects HOW they will buy, not IF. (i.e. they won’t get many concessions from the seller for repairs)
In my opinion, a back up offer has nothing to lose and everything to gain.Google+