Though banks negotiate purchase contracts verbally before signing off on the final paperwork, a residential real estate purchase contract hasn’t officially been executed until it’s signed by both parties and returned to the buyer.
Or is it?
Put another way, when is the moment of conception – the moment where a purchase offer elevates to the status of an accepted and executed contract?
That’s the question a pair of clients are trying to determine right now.
We viewed a property last week only to learn the bank already has verbally accepted an offer but has not sent back the executed contract. We submitted an offer anyway with the hope either of getting it in front of the bank before the original offer is signed or, if nothing else, accepting position as a backup.
Can the bank still accept another offer after verbally agreeing to one? I would say yes, since the original offer hasn’t been signed and returned to the buyers. That the listing remains Active and not in Pending status indicates to me that hope still remains.
But will that hope translate to success in practice? That we don’t know …
It’s possible the other offer is stronger than ours (though we don’t really know for sure what was offered.) But it would be nice to know the offer was viewed, just in case it can turn out to be a better deal for the bank as well as my buyers.
If the offer does end up in backup status, what does that mean? Basically my buyers will be in limbo, hoping both for the original offer to fall through and for no better offer to come through in the interim. It’s a tough spot to be in and one not often chosen by buyers in any market.
We’ll see what happens.
[tags]Phoenix real estate, real estate negotiations[/tags]