So if a buyer has a escalation cause no other buyer has a chance?

Asked by Jajudge, Bowie, MD Sun May 19, 2013

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The Roskelly…, Agent, Gambrills, MD
Sun May 19, 2013
Unfortunately that is not correct. Price is not the only consideration in an offer. And if you offer MORE than what the property is worth via an escalation clause, a savvy listing agent will not consider that offer valid. Sellers are looking for the best offer to meet their terms. This may include timing to close, possibility of a rent back, buyer qualification and loan type (conventional, VA or FHA), how much money the buyer will be putting down and whether or not there is an inspection contingency or other inspections.
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KEITH PARKER, Agent, UPPER MARLBORO, MD
Sun May 19, 2013
Answer the question. No one knows it all. Respect others comments. Thank you.

Hello jajudge,

The best thing you can do is put in your best offer the first time. You may not get a second chance to make a higher offer. It is imperative that you have a good realtor with knowledge of escalation clauses if you decide to go that route. One of the biggest factors in your offer is the knowledge of what kind of sale it is (i. e. regular, short sale, foreclosure). If it is a regular sale or foreclosure, they are usually most concerned about their bottom line. The highest offer. Because the seller in a short sale does not get any money out of the deal, escalation clauses do not play as big of a factor in that kind of transaction. Hope that helps. Wish you well!
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Bridgette Ch…, Agent, Philadelphia, PA
Sun May 19, 2013
Jajudge,

Not necessarily. Escalation clause are not uncommon when there is a multiple offer situation. However, there are other factors that come into to play when a seller is reviewing reviewing offers. Other buyers may have "a chance" if the seller is looking at other terms in the contract besides the amount a buyer offers. One must always remember when an escalation clause is used, the issue of the appraised value comes into play for they buyer. If the property doesn't appraise, the buyer who submitted the escalation clause is responsible for the difference in appraised value versus purchase price. A buyer should fully understand the pros and cons when considering an escalation clause.

http://www.BridgetteChase.com
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Robert McArt…, Agent, Fallston, MD
Sun May 19, 2013
Not true. The buyer with the escalation clause will have a cap on the amount they will ultimately spend on the property. As long as other buyers put in an offer that escalates above that offer and the overall offer is acceptable to the Seller, then it certainly has a chance.
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Akil Walker, Agent, Upper Marlboro, MD
Sun May 19, 2013
Hi Jajudge

It can depend on many factors for example a cash offer with a short closing timeframe may be more appealing for a seller
Web Reference:  http://www.akilsellshomes.co
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Charles Bail…, Agent, College Park, MD
Sun May 19, 2013
If your escalation clause gives the seller a higher bottom line you would likely win the contract. There can be many factors that influence the decision though. If the escalation clauses go far above a reasonable estimate of what the appraised value would be sometimes the seller would take the stronger buyer but a lower price contract.
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Greg Myers, Agent, Gaitherburg, MD
Sun May 19, 2013
Not un-common for multiple buyers to escalation clauses.
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Richard Iaro…, Agent, Gambrills, MD
Sun May 19, 2013
Offers are complex, and the addition of an escalation clause is no indicator that it will be the one selected.
Web Reference:  http://RichSellsHomes.com
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