Nadia, Home Buyer in New York, NY

We are first time home buyers who were recently involved in a bidding war. Our offer was finally accepted

Asked by Nadia, New York, NY Fri May 23, 2008

only to learn 48 hours later that a third party came in with a better offer. The house would be ours if we could cough up an extra $100,000. We walked but our quite burned by the experience. At this point an accepted offer means nothing. Is this commn practice? Should we expect this game everytime we bid on a house? Any insight would be appreciated. Thanks!

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Vince, Home Buyer, New York, NY
Sat May 24, 2008
The so called "bidding war" has many facets. I recently was involved in a similiar situation, where it appeared to me that the seller was falsely hyping the deal. The "terms" of my offer was accepted, and no less that 2 hours later REJECTED! It just so happens that a few weeks later the seller came back to me, and offered me the house since the high bidder was unable to secure financing. I was very happy to decline since I found a better home, touche. The terms of an offer is important, they may bid a higher price, but may not have good credit, a large down payment, may have to sell their existing home to buy, and of course maybe unable to get a loan. If you have all of your ducks in a row, you will seal a deal soon. BTW-If the deal for the last house falls through, by no means pay that 100k over asking. Good Luck!
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Christopher…, Agent, Tarrytown, NY
Fri May 23, 2008
Hi Nadia, As Gail stated in NY the deal is not done until contracts are fully executed and even then it has been know to change. The law states that all offers must be presented until closing of the property. The thing with bidding wars and "highest and best" scenarios is anybody can go higher. Things to take into consideration is if the house goes ridiculously high will it appraise? Also think about the amount of time you plan to live in the home, if the house is maxed out and you plan on selling again in 5 or so years it most likely isn't a good investment, but if you plan on staying in the home for 20-30 years it would make better sense to overpay a little. It really depends on what the home is worth to you. I also like to tell my clients we need to move quickly and keep the deal moving, there are sellers that will accept an offer that satisfys them and keep all others as backup and others that keep their eyes open for better, everybody is different. My advice is remain vigilant, don't have expectations, and realize that if a certain home doesn't work out it wasn't meant to be, you can only do whats within your means. Keep in mind as well that although price means alot, the terms can make or break the deal, ie: how quick you can close, amount of mortgage if any, contingencies, etc. I am confident that with the amount of inventory and this learning experience you will be successful.

Christopher Pagli
Associate Broker
Legends Realty Group
914.332.6300 x107
914.406.9023 cell
1 vote
Barbara Cart…, Agent, New Paltz, NY
Sun May 25, 2008
Hello Nadia
Unfortunately, this can happen, as you know, but it is not commonplace. Until everything is signed at the closing table the buyer is still a buyer and the owner is the owner. Your Realtor should advise you that once contracts are signed chances are good that it will close. There are no guarantees though.
Do not be discouraged. Hire a great Realtor who will have a list of attorneys and home inspectors that they reccomend and start your home search again. Ask your Realtor if they have a free home buyers guide for you. This is a new process for you and while it is very exciting it can be stressful as well.
I wish you the best of luck- You will find a home you love just as much- or probably even more then the first.
Barbara Carter Exit Realty Services New Paltz NY
0 votes
Lynn Kenton, Agent, Ventura, CA
Fri May 23, 2008
I'm not familiar with all the details of you situation or real estate practices or law in New York state, but in California once the offer is signed and receipt is ackowleged it becomes a binding contract and canot be altered or canceled without signed aggreement by all parties.
I've sold real estate in Ventura, California for 19 uears and have rarely seen a seller bail on a buyer. The seller could be liable for liquidated damages in most cases. You can probably find a real estate legal hotline on the internet for your state to give you some guidance. Good luck and don't give up!
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Gail Gladsto…, Agent, 11743, NY
Fri May 23, 2008
Unfortunately, New York practice is not as pleasant as other states. The house is yours when you are fully in contract. Nothing is one-sided; at any time, you have the opportunity to keep looking and if you found something better, you also can walk from the deal.

I apologize that no one thought to prepare you for the possibility; I don't like consumers getting blindsided.
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