If there is more than one offer on the table then the listing realtor has to tell you. It's an ethics violation if they don't or if they lie. They are obligated to be honest. Remember, the Realtor is the Listing Agent representing the seller, the bank.
Here's the deal with highest and best (my POV)...
If you offer wasn't high enough in the 1st place, then either your clients coaxed you in to writing too low an offer. If you properly educated your clients with what a fair market offer is then you should stick to your guns.
Why pay more than it's worth?
If you don't get the home, go to the next one.
This bank "highest and best" just creates a "sealed bid" type of auction or "Ebay" feel for selling homes.
I personally don't waste time with highest and best because I write offers at value, not speculation.
All The Best,
Ph (480) 220-7491
Fax (866- 711 8573
Keller Williams - Scottsdale, AZ
2008-2009 Master of Real Estate award recipient
ABR, GRI, ePro, CNE, MRE, AHWD