Properties With Accepted Contracts Aren't Available

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This is one of the hardest things to get across to many people - agents included. A property with a fully negotiated purchase contract is not one that someone else can buy. They have a legal agreement binding them to sell it to someone else. If they sold it to you, they could be sued for what is called "specific performance" - in other words, do what you agreed that you would do - and I am given to understand that you don't want to be on the losing end of such a suit.

You are wasting your time making an offer that the owner is not free to accept. I would actually argue it's worse than that: You're effectively trying to bribe someone into not meeting their contractual obligations. If your terms are worse than what they have now it's not a very effective bribe, but you're still making the attempt. If you were in the position of the accepted offer, how much would you like it?

Nor is a so-called "back-up offer" likely to get you the property on any kind of advantageous terms. Watch the property in MLS and see if it drops back to "available" rather than pending, but making a back-up offer will do nothing but weaken your negotiating position if that property should become available again.

There are ways to get out of accepted contracts. The classic one is non-performance of the other party. The other side doesn't do what they said they would do - they go past the agreed upon escrow period, they can't qualify for the loan, whatever. There are as many ways to fail in contractual obligations as there are contractual obligations. Neither side is required to cut the other side one iota of additional slack beyond what is spelled out in the contract.

With that said, if the contract isn't one you want to honor, why in the heck did you agree to it? If it doesn't put you into a better position, why did you agree to it? The only reasonable response to this that I'm aware of is "It is better than no deal, but then someone came along and offered a better one" To which the person on the other end of the negotiated contract will reply, "too late." They have now spent significant resources towards honoring their end of the deal you agreed to. If you hadn't made the agreement, they wouldn't have spent the money for appraisal, inspection, etcetera. None of these transfer to another property.

As a final word on the subject, it is possible that some agents will tell you a property is under contract when it is not in fact under contract. Perhaps they're finalizing the last few details and it's really at least in the neighborhood of true. Sometimes, there isn't an offer at all and the agent is simply filtering out offers they see as undesirable - usually from the point of view of a bad agent rather than that of their client, the seller. Unfortunately, what all of these possibilities have in common is it's rarely worth paying a lawyer to fight about. Let it go - there are other properties just as good out there, where nobody is playing these counter-productive games.

Caveat Emptor


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About this Entry

This page contains a single entry by Dan Melson published on November 23, 2019 7:00 AM.

Buyer's Agents Presenting An Offer In Person was the previous entry in this blog.

Multiple Offers: Weak But Increasingly Common, And It's Your Listing Agent's Fault is the next entry in this blog.

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