Presentation of and Response to Offers to Buy Real Estate
Presentation of and Response to Offers to Buy Real Estate
All offers to buy real estate must be presented to the seller or his agent as soon as possible. That means that as soon as the buyer's offer is made available to the listing agent, that offer must be presented to the seller. The listing agent has no discretion in whether to present an offer to the seller. All offers must be presented, even if the listing agent believes that the seller will not accept the offer.
Duty to Explain an Offer
The listing agent must explain an offer and give an estimation of the net proceeds the seller would receive from the sale if it were to take place under the offer that is presented. The listing agent must present sufficient financial data to enable the seller to make an informed decision as to which offer to accept.
Competing Offers
When competing offers have been submitted to the agent, each offer must be presented with the utmost confidentiality and impartiality. The listing agent may not show any preference for one offer over the other, even if one was received prior to the other or if terms of one offer are more favorable and would result in higher net proceeds for the seller.
If the listing agent receives more than one offer at the same time, the agent must present all of the offers along with information regarding the financial background and qualifications of the respective buyers, as well as information regarding the net proceeds that would be available under each offer. If the listing agent receives a second offer while the seller is considering a prior offer, the agent must notify the seller of the second offer and caution the seller not to respond to the first offer until he can thoroughly review the second offer and decide which offer would meet his or her financial goals and otherwise be in his or her best interest.
Responses to Offers
Although the listing agent has a duty to provide financial background and information regarding the financial benefits to the seller, it is the seller's sole right to accept or reject an offer. Once the seller has made a decision, the listing agent has a duty to communicate the seller's response to all offers that have been presented. The seller's response must be communicated promptly because time is usually made a critical factor in contracts to buy and sell real estate.
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