10 Tips for Handling Counteroffers

10 Tips for Handling Counteroffers

Yay!  You have an offer, but wait, the buyer wants the seller to pay all their closing costs... ahh.....let the counteroffer dance begin..... 

Here are some important tips to remember:

1.  A counteroffer negates the original offer. You've officially put a new offer on the table.

2.  All changes to the original offer must be accepted +/or initialed by both parties.

3.  A counteroffer is legally binding, and it is valid until it is withdrawn or rejected.

4.  When withdrawing a counteroffer, it is best to do so the quickest way possible.  Making a phone call is best, and you should also follow the phone call up with an email just to be sure.  Verbal withdrawals of offers are acceptable. 

5.  It is best that neither party sign an offer and simultaneously cross out changes.  Ie.  Seller signs offer, but changes closing date.  The offer is not effective, regardless, but just to cover your assets, instruct the seller to not sign the offer until the buyer agrees to the new closing date.

6.  Better yet, instead of crossing out items on offer, it is best for you to submit TAR 1926, "Seller's Invitation to Buyer to Submit New Offer".   The seller can still continue to receive offers from other buyers.

7.  There is no limit to the number of counteroffers that can be submittted back and forth.  Stay calm and congenial.  Keep your emotions out of contract negotiations.

8.  Let your client be aware that in this state of back and forth negotiations, there is no official acceptance of an offer, so the seller is free to accept any other offer that may come.

9. When making a counteroffer, use reasonable response deadlines.  That way, you are not wondering what the heck is going on when you have not heard back from the other realtor in over 24 hours.

10.  The effective date of a real estate contract is when it is signed by all parties to it, any changes are initialed by all parties to it, and the last person submitting the offer or counteroffer has been so informed. Once that occurs, the offer becomes a contract.