Why You Shouldn'T Make Home Purchase Offers On Multiple Properties
What do you do when you are in the market for a home and you find more than one interesting house? Some people deal with the issue by making offers on different properties as a way of hedging their bets. However, that isn't necessarily the best way to go, and you should be cautious if you decide to take that route. Here are some of the complications associated with multiple purchase offers:
Your Agent Might Not Like It
If you are buying a home via an agent, which is the advisable thing to do, your agent may not approve of making offers on multiple houses. Some agents don't like such deals because it is unethical; you are basically promising the same thing to different people knowing very well that you won't be able to go through with some of the deals with you get multiple acceptances.
Note, however, that your agent may also encourage the idea if you are in a hot property market and properties are selling like hot cakes. In short, your agent might not like it, but there is no harm in asking since that is one of the reasons you have an agent in the first place.
Complications Arise When Multiple Offers Get Accepted
Another problem with making multiple offers is that there is always the possibility of getting multiple offers accepted. You will be forced to decline some offers if that happens, which is equivalent to breaking a contract since an accepted purchase offer is a legally-binding contract. This means you will bear the consequences of breaching the contract; for example, you may lose your earnest deposit money. If you have to make multiple offers, you should build in escape clauses or contingencies that allow you to wiggle out of the contracts safely.
You May Not Have Enough Funds for the Deposits
If you want to buy a house, you are required to deposit earnest money with every official purchase offer you make. Making the deposit signals to the seller your seriousness about buying their property. What happens if you want to make multiple offers but you don't have the money to cover all their earnest money checks? Some people deal with the situation by making one check and photocopying it so that they can show it to different sellers. As you can imagine, this is risky because you can be held in breach of contract if the seller realizes your deceit. If you have to make multiple purchase offers, make sure you really have the money to make the different deposits. Talk to a real estate agency for more help.
