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Multiple Offers

How to Handle Multiple Offers

When properties are newly listed and favorably priced, they often create high demand. In some cases, Sellers may receive more than one offer at a time. If this happens, what should you do and what shouldn’t you do?

Here’s how to handle multiple offers:

Begin by letting each Buyer know that you are about to receive more than one offer. Next, set a deadline and ask each Buyer to submit their highest and best offer to you in writing. Make sure each Buyer is aware of the deadline date and ask each Buyer to include a copy of their mortgage pre-qualification letter. After the deadline, review all offers and determine which offer is best for you. Treat each Buyer fairly and do not allow yourself to be pressured into making a poor decision.

Explain to each Buyer that you will be reviewing each purchase offer with your attorney. This will give you the extra time you need to evaluate each offer. It will also help you determine which Buyer is most serious about purchasing your property.

As you review the terms of each offer, think about the needs and stability of each Buyer. Review each offer in its entirety and do not begin negotiating with more than one Buyer at a time. Negotiate first with the Buyer who has made the strongest and most reasonable offer!

A word of caution: When more than one offer is received, be careful to treat each Buyer’s offer fairly. Do not take too long to respond because you could end up losing a Buyer! Buyers’ emotions can run high when competing for properties, so remember to be precise, courteous and professional. Serious Buyers will only wait so long for a response before moving on to other properties. So be sure to respond within a reasonable time-period. In competitive bid situations, Buyers become anxious, unpredictable and sometimes they will even pull their offer! So be fair and respond to each Buyer within a reasonable time-period.

Upon reviewing all offers, accept the offer that best suits your needs or counteroffer and negotiate the fine details. Try not to make the process too complicated or you will regret the fact that you did! Treat each Buyer with respect - the same respect you would like if you were the Buyer.

Once your decision is made, contact all Buyers and let each Buyer know that you have accepted another offer. Do not disclose the terms of your accepted offer to the other Buyers because you never know what might happen with your sale prior to closing - review our section on Why Contracts Fail. Tell the other Buyers that you received a better offer and thank them for participating in the process. Ask the other Buyers if they would like their offer to be held as a Back-up offer.

It’s worth repeating: If two or more offers are received, then carefully review each offer. Never negotiate with more than one Buyer at a time and never accept or sign more than one offer as your primary contract! It is a good idea to review all purchase offers and back-up offers with your real estate attorney before signing a contract.