The Legal Side of Multiple Offers in Real Estate

With the real estate market making marked improvements, and more talk of bidding wars and multiple offers, it’s beneficial to know some of the legalities of situations that you could run into both as a buyer or a seller.

Are verbal acceptances considered binding?  No.  Offers are not binding until they are signed by both the buyer and the seller.  Another important fact to note under this scenario is that the Listing Agent has an ethical duty to protect its client’s best interests.  In doing so, the Agent is expected to continue to receive and submit offers to the seller until closing ensuring that the seller accepts the best offer for them.  Therefore it is important that both the buyer and seller are well aware that no offer or acceptance is binding until signed by both parties.

It is important to note that offers and acceptances done via email may be considered binding if written in detail. (See Feldberg, et al. v. Coxal)

Another common question Deborah Lucci, Real Estate Agent, gets asked is in regards to a seller’s obligation to accept a cash offer. When multiple offers are submitted and one of them is a full price, no contingency, cash offer it is often misunderstood that the seller is required to accept that offer.  That is not the case.  In this situation, the seller may wish to seek a higher price, even if it is not a cash deal.  This may be risky for the seller as all prospective buyers may walk away from the property all together, but it is the legal right of the seller to accept the best offer for them regardless of a full-price cash offer.

Have more questions regarding multiple offers and bidding wars?  Deborah Lucci, Real Estate Agent, can help you or direct you to the proper place to find the answers you’re looking for.