Backup Offers Should Make Sellers Jump for Joy
If you are going to put in a backup offer, it should be an offer that makes the seller swoon.
A backup offer is an offer a buyer submits even though a property is already under contract with another buyer. If the buyer with the contract in first position terminates the contract then the backup offer would go into effect.
In Colorado, once a seller is under contract he/she can’t legally get out of it. The only way out of the contract for the seller is to try to get the buyer to terminate by not being cooperative – not negotiating with the buyer on inspection, extending dates and deadline for the buyer, etc. Therefore, a backup offer should try to incentivize the seller to not be amiable with the buyer – entice the seller to try to force the breakup, if you will.
So, how do you become a contract-wrecker with a backup offer? Submit an offer with a higher price and/or better terms than you believe the contract in first position has.
If your backup offer doesn’t impress the seller not only do your chances of getting the property not greatly increase, your chances might actually go down. A seller could use a not-so-good backup offer as a negotiating tool with the buyer they are under contract with. Once a buyer in first position knows that a backup offer is in place they tend to ask for less from the seller – making it harder for the seller to force a termination.
So should you submit a backup offer? My answer is yes, but only if you are willing to sweep the seller of his/her feet.
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Katie (Good Good Founder) | 720.415.4914 | Katie@goodgoodrealty.com