Another Basic Real Estate Purchase Question

Not to hijack a similar thread, I wanted to dig a little deeper into backup offers and how they actually happen. I would of course use a licensed agent to do something like this, but I’d like to better understand the fundamentals. I realize there may be differences based on state law, so let’s generalize it as much as possible and just assume I live somewhere in the US.

Here’s the hypothetical scenario:

I’m interested in buying a condo, and I see one that I like. After a few days of mulling it over I decide to submit an offer. I call my real estate agent and I am told that my next door neighbor submitted an offer yesterday that has been accepted by the seller and the property is now Sale Pending. Assuming everything goes as planned, and any contingencies are lifted, my neighbor will end up with the condo since there is a purchase contract now signed by both parties. Let’s say I want to submit, and the seller is willing to accept, a backup offer.

Some questions:

  1. Is my neighbor’s offer visible to me, other than by my neighbor telling me what’s in it? Does the seller have to tell me what the offer was that he has accepted? If I know this information I can make some assumptions about what the seller is willing to accept.

  2. Let’s assume that I have no idea what the pending offer is, so I am going to be presenting my backup offer blind. Do I write it up like any other offer, sign it and then submit it to the seller? Does the seller acknowledge receipt of the offer and counter-sign it or just hold onto it unsigned until the pending offer falls through, assuming it does?

  3. Does my second offer have precedence over a possible third or fourth offer or are they all treated the same should the pending offer fall through?

  4. I assume the seller doesn’t negotiate my offer until the pending offer is no longer valid. Once that happens would the seller let me know that he is now considering my offer and any negotiations would happen?

  5. The pending offer has an inspection contingency and the buyer decides there are too many issues with the condo and asks for his offer to be cancelled. At that point could the seller accept my offer without me agreeing? A month may have gone by and I may be no longer interested in the property.

First:
Find the form used to make R.E. offers in your state.

While you could make an open-ended (yes, I know: Perpetuities, lawyers), most state that the seller must respond within 48 hours. If the seller does not, the offer expires.
The seller’s agent will probably tell your agent if the offer is too low.

If you really want the seller to be able to call you in a month and compel you to honor your offer, write it up. I’d doubt if any agent would want to present such an offer (various reasons), but would (in CA, ar least) be legally compelled to present it.

This includes “I’ll pay you 1/3 of all the other offers” losers with no chance of success.

Just don’t expect the agent to ever again return a call.