There are No "Take Backs" with Counter-Offers

By
Managing Real Estate Broker with RE/MAX Advantage | Managing Broker 17050

After countless hours shopping; scouring every online real estate site available (just in case you missed something better out there), disappointing drive bys, in person showings, last minute second guessing and finally.....you're ready to write an offer! 

Cool! What's next?

You make an offer, which means your agent will prepare the purchase contract based on the price, and terms you've approved.

Make no mistake, this is a contract!

The verbiage and terms of these pre-printed forms have been carefully reviewed and edited by attorneys.

 You're going to sign this contract prior to your agent sending it to to the seller's agent for review.

Read the contract you are signing!

Or, at a minimum, make sure you understand the terms. There will be time frames, "outs", consequences for not performing, and conditions which will kick in based on this, that, or the other thing.

Yes, your agent is there to guide you, but sadly, sometimes even Agents aren't as knowledgable as they should be.

A perfect example of where not paying attention can cost you is with the counter-offer process. 

Here's an example:

Seller Salley is asking $200,000 for her condo. Buyer Bill offers Salley $185,000, and asks for a 120 day Escrow, and wants her patio furniture included. Salley just bought the patio furniture and is insulted Bill would make a low offer, with a long close AND ask for her personal property. Her agent suggests she counter, so she goes back with a price of $192,500, 90 day Escrow and NO furniture. Bill is thrilled with this offer, but he thinks he can get just a little bit more. So he counters Salley's counter at $190,000, conceding the patio furniture and extra 30 days closing. Salley says no and is no longer willing to negotiate with him.

Bill signs the $192,500, 90 day Escrow Counter.

The only problem is, this offer is no longer on the table!*

A counter-offer is a rejection of the offer on the table.

There are no "take-backs".

This goes for both parties.

Once an offer, or a counter-offer is rejected, the offering party has no obligation to honor their now rejected offer

In the course of reviewing files, I find this most commonly mis-understood during inspection negotiations. The seller offers to fix "x", the buyer wants more, the seller says no and the buyer doesn't understand that because they have rejected the seller's response, it's no longer on the table.

No take-backs...of course the parties can continue to move forward by mutual consent, however there is no contractual obligation. 

Always understand the terms of any contract you sign.

The time-frames and consequences of every response. Your real estate broker should always outline your options, the pros and cons of each choice you make. However, it's your John Hancock on the bottom line.

Make sure you're making an educated decision prior to putting pen to paper.

 

*This post is written from the perspective of using NWMLS forms in WA State. Other states may have different provisions or processes outlined within their proprietary contracts.

 

 

 

Negotiating a real estate contract (emphasis on the word contract), is often misinterpreted not only by the principals to the transaction but many times the Brokers involved.

 

 

Photo Credit David Castillo Dominici

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Thanks for reading!

 

 

 


 

 ____________________________________________________________________________________________________________________

Colleen Fischesser REMAX

 Serving the beautiful Pacific Northwest Since 1990!

 

Colleen M. Fischesser, Managing Broker

RE/MAX Advantage, L.C.

Serving Seattle and the Chelan Valley

206-491-3819  (Cell/Text Seattle)

509-699-1611 (Cell/Text Chelan)

 

 www.ColleenFish.com

www.ChelanPropertyShop.com

www.NWPropertyShop.com 

 ___________________________________________________________________________________________

This is a personal blog based on my opinion and experience in the real estate industry. All content is provided for informational purposes and should not be construed as legal, financial or tax advice. Laws, industry practice standards and procedures vary by state. Readers are advised to contact appropriate third parties for professional advice when needed. Any questions please let me know!

 

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Location:
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Groups:
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NW Home Source
Puget Sound - WA Real Estate
Tags:
real estate negotiations
making a counter offer
structuring a real estate purchase contract
washingston state real estate brokers

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Rainmaker
1,960,484
Ronald DiLalla
Century 21 Discovery DRE 01813824 - Anaheim, CA
No. Orange Cty Real Estate

Someimes, this area can cause some major problems.  Thanks for sharing.

Mar 05, 2014 02:05 AM #1
Rainmaker
473,514
Colleen Fischesser Northwest Property Shop
RE/MAX Advantage | Managing Broker - Chelan, WA
A Tradition of Trust in the Pacific NW since 1990!

Ronald, I hate being the one to have to tell the broker on the other side their clients can't "go back" and sign what they have previously re-jected. Especially when there are multiple offers involved and it means they've lost out on a house they love.

 

 

Mar 05, 2014 02:07 AM #2
Rainer
106,803
Rob Marken
Bend River Realty - Bend, OR
25+ years experience in Bend

Great points on how countering and recountering could lead to issues.  Thanks for sharing. 

Mar 05, 2014 02:08 AM #3
Rainmaker
762,673
Shanna Day Team Leader AZ & UT - Call 480-415-7616
Keller Williams Realty EV (AZ) & Keller Williams SLC (UT) - Mesa, AZ
Top .0033% of 40,000+ Realtors in our MLS

Great points on the risks of countering and re-countering.   What I see a lot of (with mostly newer agents) is that they think they are protected when they are w/in the acceptance period for a counter offer.  They don't even think about another higher offer slipping in and then getting the rug pulled out from under their buyer(s), when they have not responded yet to a counter offer.   It is not a contract until all parties have executed the contract by signing, dating (crossing all the t's and dotting all the i's so to speak).   Don't get caught not knowing such a simple concept. 

Mar 05, 2014 05:36 AM #4
Rainmaker
473,514
Colleen Fischesser Northwest Property Shop
RE/MAX Advantage | Managing Broker - Chelan, WA
A Tradition of Trust in the Pacific NW since 1990!

Another great point Shanna!

Mar 05, 2014 10:57 AM #5
Rainmaker
828,765
Sheila Newton Team Anderson & Greenville SC
Berkshire Hathaway HomeServices - C. Dan Joyner - Anderson, SC
Selling the Upstate since 1989

Most don't understand that a counter is a rejection... then you are making an offer to the other party.. I always caution my clients about that. Great post!

Mar 05, 2014 10:40 PM #6
Rainer
453,370
Diane M. Phillips Realtor 443-286-4365
Frankly Real Estate Inc. - Manchester, MD
Specializing in Carroll Co., MD

Colleen ~ Great post! Counters are tricky and the rejected offer does not become the default. I agree, no take backs!

Mar 06, 2014 09:45 AM #7
Rainmaker
1,500,532
Inna Ivchenko
Barcode Properties - Encino, CA
Realtor® • Green • GRI • HAFA • PSC Calabasas CA

I just had this situation on my listing, buyers sent me a low ball offer, we rejected( no counter), they went up a bit~ we rejected again. By the time they were ready again, we got a good offer and opened escrow. It is a very bad strategy to buy.

Mar 06, 2014 03:38 PM #8
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Rainmaker
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Colleen Fischesser Northwest Property Shop

A Tradition of Trust in the Pacific NW since 1990!
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