A backup offer is used quite a bit in metropolitan areas and busy markets where there are lots of sales and a lot of competition. But that doesn’t describe the Sequim real estate market, does it? A backup offer might still be a good idea in Sequim, but when would it be an act of futility, and how can you go about gathering the information you need to decide whether to make a backup offer?
Backup Offer General Practices in Sequim
A backup offer is simply an offer, just like any other offer, it just happens to be behind a primary offer that has already been accepted by the sellers. A backup offer might be submitted in a very competitive market where there is a practical possibility that the primary offer will fall through, in which case the backup offer automatically steps into first position. The seller is obligated to close under the terms of the backup offer if they accepted the backup offer earlier.
In Sequim we don’t have a large contingent of buyers who are first time homebuyers, and whose financing might be rejected, or who may have other issues that could hinder their ability to complete the transaction. What we do have are eminently qualified retirees, most of whom have had one or two careers as professionals, have perfect or nearly perfect credit, and who put down large down payments. They are pre-qualified, and it is extremely rare that one of these highly qualified retirees will have a transaction that fails because of financing.
A buyer could terminate a transaction because the home inspection fails, but that is rare also. Most retirees are not going to make an offer to begin with if the home looks like it has serious issues. Sequim home sellers tend to be very good about maintenance and keeping their properties in good condition, so this is the other reason transactions rarely fail in Sequim. Where a home inspection turns up some minor issues, the buyer and seller almost always work out fixes or credits. Where a home inspection reveals major issues, no one wants that home, so even a backup offer would probably be killed by a buyer.
Backup Offer Data on Active of Pending or Sold
In the past, it has been hard for a buyer like you to find out whether a listing is truly “Active” (available and not pending), or “Pending” (aka Active Under Contract), or “Sold” and closed.
I solved this problem for buyers long ago on an MLS site I designed and programmed for Sequim buyers. MLS sites in the past would show a listing as “Active” even if it was pending. They did that presumably to get you to call, in other words, as a lead generator. That’s repulsive, isn’t it? I found it less than completely honest, so I programmed my site years ago before anyone else at the local level, to allow you to search for truly “Active” listings and not suck you into thinking a pending listing was still Active and available.
I also designed my MLS site for buyers to allow them to search for and view sold properties. This site is also 100% accurate since the source data comes from the listing agents data, not scrapped off the Internet like many syndicated MLS sites.
You’ll find my MLS site at Sequim4Sale.com, and you’ll find on that site videos which show you how to find Active, Pending, and Sold properties. On the home page, you’ll see this sentence near the top of the page: “This MLS site has 100% of all the Sequim Real Estate Listings and Port Angeles listings in the OLS. All our listing data and information is UPDATED EVERY FEW MINUTES on this site. Get the most out of this site with this video at: Sequim Real Estate and Port Angeles Real Estate MLS Video.
This information will also help you when you are thinking about whether to make a backup offer. Deciding to draft a backup offer requires some careful thought and analysis about the property, prices, and about your personal plans and finances. There’s a lot to think about before drafting a backup offer. This is where I come in. It will help you to have an experienced player in your corner with whom you can talk through all the issues, and ultimately you will know for sure whether you should draft a backup offer or pass.
Last Updated on March 8, 2019 by Chuck Marunde
Leave a Reply