Making multiple offers at the same time

15 Replies

So Brandon Turner recommends making an offer once a week. We currently have put in one backup offer about two weeks ago and finally found another property we feel could be a good deal, however, the realtor we’re using told us we should withdraw the first offer if we want to put in the other offer.

I asked our agent what the potential ramifications could be and she said we would be forced to buy both houses (not the worst scenario ever) and if we don’t we could potentially be sued and lose our earnest money.

We’re wondering how others go about this. Does anyone in here put an offer out there a week? Should we withdraw the previous week’s offer if we do? Does it make sense to keep two offers open and if one comes through try to go with the better deal?

Thanks in advance.

I would personally withdraw the first offer before putting in a second offer to avoid legal blowback like you mentioned. If you do put two offers in at the same time and you only want one property your agent needs to make sure you have a solid contingency clause to be able to back out.

I decline to do that for anyone including myself. If one thinks he can get a home with multiple offer(S) and the agent is unlikely to find other realtors to help him getting offer accepted. Realtors know a lot people and often they trade "shop talk" and excuse themselves. The market has cooled off a lot. One has to do diligence submit a clean offer before going off tangent try next.  Double hitters is not a good idea. Those realtors typically develop a poor reputation not wanted by others.

If you're willing to close on both, then I think it's fine. If not it depends on how your contract is structured. In TX, the TREC contract has an option built into it, and in most cases, people are really only risking $100 for each offer they submit. If they both were accepted, and you just wanted to move forward on one, you would be out $100 on the other. The $100 option fee is negotiable, but that amount is probably the average for SFR here. It's usually enough to discourage most people from putting in multiple offers simultaneously, but some still will.

@Sam Shueh that’s great information. The last thing we want to do is leave a bad impression with people when we’re trying to network. My other fear is leaving our realtor feeling abused. How many times is she going to be okay with us withdrawing an offer and submitting another? Does it make sense to tip her to let her know we’re not just abusing her time?

Really appreciate the insight.

@Joseph Cacciapaglia thank you Joseph! Being in Oklahoma I think we could lose our earnest money but I don’t think it has that low of a limit. Good to know if we ever invest in Texas.

It’s really not a bad thing for us to get both, we just didn’t really want to burn through all of our cash reserves in the current economic situation or in the event we had unforeseeable expenses on one of the houses.

I heard Tarl on the BP show on Thursday mention that he has gone back after getting an offer accepted and is telling the seller due to the current economic changes he is lowering his offers.

What would you do if you had two good deals on the table at the same time with one that had been a backup deal for a couple of weeks with no response?

Thanks again!

Originally posted by @Brian Holshouser :

@Joseph Cacciapaglia thank you Joseph! Being in Oklahoma I think we could lose our earnest money but I don’t think it has that low of a limit. Good to know if we ever invest in Texas.

It’s really not a bad thing for us to get both, we just didn’t really want to burn through all of our cash reserves in the current economic situation or in the event we had unforeseeable expenses on one of the houses.

I heard Tarl on the BP show on Thursday mention that he has gone back after getting an offer accepted and is telling the seller due to the current economic changes he is lowering his offers.

What would you do if you had two good deals on the table at the same time with one that had been a backup deal for a couple of weeks with no response?

Thanks again!

 I'm never a fan of backup offers to begin with. I usually let the listing agent know that we'll be happy to submit an offer if the current contract falls through. This seems to work just fine here. I've gotten a decent number of deals this way. I don't know how it would go over in your market. If I were in your situation, I would just pull the backup offer, but let the agent know you're still interested if it falls through. Moving forward, on additional offers, I would just let them know they have 24 or 48 hours to accept, depending on how active you plan on being. There is no benefit to leave offers in, unless you're going very low, and just hoping they eventually cave.

As a buyer there is always a way out of the contract especially if you are in the inspections stage.  Here is the problem:  If you don't think you can close DO NOT make the offer.   You want agents and wholesalers to call you with deals.  I have been doing this for 20 years and and get calls with deals from realtors and wholesalers all the time.   Why, well it is not just because of my rugged good looks and engaging personality.   If I say I want it and make and offer I ALWAYS close.  Don't be the guy that backs out of deals or you will get no deals.

Originally posted by @Joseph Cacciapaglia :

 I'm never a fan of backup offers to begin with. I usually let the listing agent know that we'll be happy to submit an offer if the current contract falls through. This seems to work just fine here. I've gotten a decent number of deals this way. I don't know how it would go over in your market. If I were in your situation, I would just pull the backup offer, but let the agent know you're still interested if it falls through. Moving forward, on additional offers, I would just let them know they have 24 or 48 hours to accept, depending on how active you plan on being. There is no benefit to leave offers in, unless you're going very low, and just hoping they eventually cave.

 That's an awesome idea to let them know you're still interested but back out the offer. I love it! It seems like a pretty good win-win. It let's us be flexible with our offers but still leaves the door open.

So you use the 24-48 rule on every offer you make? Do you use the same real estate agent every time?

In our recent market the asking price was almost considered bidding low. I think things have slowed down a little but then again we saw a fairly decent deal go pending on Zillow in less than an hour today. So, I guess things are still kind of wild in the Okc Metro/Edmond area. 

Thanks Joseph 

Originally posted by @Brian Holshouser :
Originally posted by @Joseph Cacciapaglia:

 I'm never a fan of backup offers to begin with. I usually let the listing agent know that we'll be happy to submit an offer if the current contract falls through. This seems to work just fine here. I've gotten a decent number of deals this way. I don't know how it would go over in your market. If I were in your situation, I would just pull the backup offer, but let the agent know you're still interested if it falls through. Moving forward, on additional offers, I would just let them know they have 24 or 48 hours to accept, depending on how active you plan on being. There is no benefit to leave offers in, unless you're going very low, and just hoping they eventually cave.

 That's an awesome idea to let them know you're still interested but back out the offer. I love it! It seems like a pretty good win-win. It let's us be flexible with our offers but still leaves the door open.

So you use the 24-48 rule on every offer you make? Do you use the same real estate agent every time?

In our recent market the asking price was almost considered bidding low. I think things have slowed down a little but then again we saw a fairly decent deal go pending on Zillow in less than an hour today. So, I guess things are still kind of wild in the Okc Metro/Edmond area. 

Thanks Joseph 


 I am an agent, so I do use the same agent every time. I don't always put a time limit on my offers. It really depends on the product type. For example, I sell a lot of fourplexes, but good ones don't hit the market very often here. When I'm making offers on those, there is very little reason to put a time limit, because they're going to have 5 other offers in a short time, and will make a decision relatively quickly. There also aren't usually other properties that my client would want to immediately offer on.

For single family homes in areas with a lot of similar inventory, there is more of a tendency for sellers to want to "shop" your offer, if it's the only one and pretty low. Those are the instances that I would prefer to limit the time that my option is open. If there are a lot of other properties that my clients are interested in, then it makes more sense to move on quickly. It also ads a little fear of loss to the seller. A bird in the hand...

Originally posted by @Tracy Streich :

As a buyer there is always a way out of the contract especially if you are in the inspections stage.  Here is the problem:  If you don't think you can close DO NOT make the offer.   You want agents and wholesalers to call you with deals.  I have been doing this for 20 years and and get calls with deals from realtors and wholesalers all the time.   Why, well it is not just because of my rugged good looks and engaging personality.   If I say I want it and make and offer I ALWAYS close.  Don't be the guy that backs out of deals or you will get no deals.

Love the unique take you've offered - It's different than most others so far. I see your point too since networking is everything and getting/keeping deals is a huge part of the game. So what's your take on Brandon's "make a deal every week" suggestion? It makes sense until you think it through and start to get like 3 or 4 deals accepted at once and you've only got enough capital to pick up 1 or 2.

We also saw a pretty neat sounding idea to back out but let the selling agent know we're still interested if it falls through. That seems like a fairly good way to save face while being less official with the offer. Or does that still leave a bad impression?

Appreciate everything!
 

 

Originally posted by @Joseph Cacciapaglia :

 I am an agent, so I do use the same agent every time. I don't always put a time limit on my offers. It really depends on the product type. For example, I sell a lot of fourplexes, but good ones don't hit the market very often here. When I'm making offers on those, there is very little reason to put a time limit, because they're going to have 5 other offers in a short time, and will make a decision relatively quickly. There also aren't usually other properties that my client would want to immediately offer on.

For single family homes in areas with a lot of similar inventory, there is more of a tendency for sellers to want to "shop" your offer, if it's the only one and pretty low. Those are the instances that I would prefer to limit the time that my option is open. If there are a lot of other properties that my clients are interested in, then it makes more sense to move on quickly. It also ads a little fear of loss to the seller. A bird in the hand...


So you're your own agent? My Wife and I have considered having one of us get a real estate license but have heard David Green and others say that it's not worth it.
You definitely make a solid argument for single family homes (that's pretty much all that's available in our area right now). I love the bird in the hand analogy. Really think it's good practice to consider things from the buyers perspective. 

We can't wait for an opportunity to get into multi-family to open up for us someday in our local market. We know it's only a matter of being prepared, timing and having the right deal funnel and connections.

@Brian Holshouser    I think the idea of an offer a week is to to keep moving and not stall out because you did not get a deal.   You keep the train moving down the track until you get an accepted offer.  After you get that deal closed and stabilized you start making offers on the then next deal.  An offer under contract means you have the deal you want at the terms you want.  The only thing keeping you from closing at that point is something that is wrong with the house it self that you have discovered in the due diligence procedures.   

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