Ronald S. Webster

Multiple offers can create multiple minefields. One of the most common issues surrounding short sales many realtors have been encountering recently is how to deal with multiple offers. If the Seller has already accepted an offer, any subsequent offer must clearly be disclosed as a back up offer.

Many buyers are under the mistaken belief that all offers must be presented to the bank. Particularly when those subsequent offers are for a higher purchase price.

The truth is that until the bank takes title to the property at a foreclosure sale, the sole discretion for accepting and presenting all offers to the bank lies solely with property owner/seller. There is no legal requirement for the Seller or Listing Agent to submit any subsequent higher offer to the bank.

In fact, it is the policy of many banks not to consider multiple offers. On numerous occasions we have been instructed to only submit one offer at a time. It is our office policy that provided we are in the very early stages of the short sale process we will submit a subsequent higher offer. However, if the subsequent offer, which must be taken as the back up offer, comes in a month later, this will most likely cause havoc in the short sale process. Banks often become stymied and typically put the file on hold if they believe multiple offers might be coming in to get the highest and best offer. Unfortunately, without a timely response many buyers will often walk away and there will be no deal.

If a seller is insistent on working with the initial offer he is entitled to do so. The bigger the price gap becomes the Seller’s problem, as it is their responsibility to work out any short fall with the bank. As to the frustrated Johnny come lately Buyer, well my response to them is typically, “where have you been?”

Short sales are challenging and not for everyone. In many cases, it may be if you snooze…..you lose!