This is a great question, because as a real estate agent, or any professional, after you’ve been in the business for a long time, you tend to take a lot of things for granted. It’s things that you would answer quickly, like, well of course you don’t, don’t make sense to somebody that’s new at it. For example, a home seller that’s only selling a property every seven or 10 years, or maybe for the very first time.
So, let me explain this one. When selling your home you are signing a listing agreement in Northern Virginia, and there’s actually a section in the listing that requests that you answer a question on whether you permit your real estate agent to disclose what other offers are in hand. Now, this is all before you’ve accepted one offer and are moving forward in closing. So, you’ve got- if today’s Monday, and you’ve received one or two offers, and a third offer calls in, and the Realtor says, can you tell me if you have any other offers, I have to refer to my listing agreement and see whether my seller told me yes I can tell them, or no, I can’t.
So you, as a seller, get to make that decision. The schools of thought on this are as follows. Some sellers don’t want to disclose, because they are afraid that if they do, the third or later offer may not want to deal with competitive offers, and they just not make an offer at all. And they may have be the highest offer. The school of thought on just disclosing it, is that it might motivate a buyer who’s going to wait a week to write an offer to write quickly. You never know where a buyer is coming from.
My thought process is, I don’t disclose any of the terms of any offer unless my seller tells me to. The terms of the offer, the price, inspections, closing, seller cost concession, are never shared, except in one situation. If you have an escalation clause and something is happening to activate the escalation clause, very often when you’re going to that particular buyer, you need to prove to them which of the other offers escalated them to a point. The escalation may be just solely on the price of the other offer, or maybe based on the terms. So, that’s an area you’re going to need to share the terms of that specific offer with that buyer only, but nobody else.
So, make sure if you’re concerned about this, or confused during a transaction, speak with your agent. Ask the questions you have, and they’ll help you to the best answers for you moving forward in your transaction.
If you are a seller in Northern Virginia, and you wanted to learn more about our smart seller program with variable commission rates, click this link to get access to that report today.
By Steve Bradley