Selling your home does not have to be an emotional roller coaster. By preparing yourself ahead of time for all the inevitable things you are going to face and following these essential ideas you
4 Things Sellers Need to Know about Backup Offers
Dated: September 1 2021
It’s no secret that most of the country is currently experiencing a strong seller’s market. Yet even in this competitive environment, almost 25% of all escrows fall through before closing. Home inspections, appraisal surprises, and loan approvals are just a few of the issues which can arise, causing the buyer to pull out of the deal.
An essential component of any listing strategy should be a good backup offer, meaning 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:
1. A 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.
2. Multiple Backup 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.
3. Leverage – Backup 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.
4. Earnest Money – Backup 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.
Backup offers should be 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.
Sweet Magnolia Homes brings a local knowledge to the markets we serve that has been obtained from years of living and working in Atlanta and the surrounding suburbs. This means our agents are intima....
Latest Blog Posts
You can’t predict the future — or control the havoc that a fire, hurricane, or flood can take on your home. But, you can take steps to ensure that you’re prepared in the event you