“Jilting” Buyer #1 for Buyer #2
Topic A at this morning’s Exceptional Properties meeting was how to handle a deal that’s been verbally signed off on, when another, significantly stronger offer materializes before all the necessary signatures are in place.
The scenario’s relevant because, in today’s slower market for upper bracket homes, by the time an offer eventually comes in, several other Buyers are likely familiar with the home and mulling an offer, too.
Hearing that another Buyer has jumped first can then become a catalyst for one or more others to do the same.
So, does the Seller switch to Buyer #2 or not?
It’s up to them.
Legally, they have every right to, because until there’s a written contract . . . there isn’t. A verbal agreement to sell real estate in Minnesota and virtually everywhere else simply isn’t enforceable.
That doesn’t mean Buyer #1 won’t be upset (and likely take it out on the Listing Agent, who actually has a legal duty to relay Buyer #2’s offer).
However, all parties to a real estate deal need to know, well before negotiation begins, that it’s not done till it’s fully executed (that is, signed).
Once there’s agreement on all the terms, everyone needs to be available to promptly sign to make that happen.
P.S.: signed offers are a two-way street: more than one Buyer has been known to change their mind and balk at signing a Purchase Agreement that they verbally committed to.