So true. I know the right thing to do, but sometimes I wish I could be Mrs. Badass instead of Mrs. Nice. Ha!
But I like your idea of keeping the list price offer as a backup, then I could play hardball with the first folks when it comes to the inspection.

Any actual offer should be in writing with a check (Earnest $). Have any of your offers been in writing?

I would like to read what one of our realtors here has to say. Business is business, and this $8500 is important to you. But I am also a deal is a deal kind of person, but when is the deal made? Is anything signed?

We received a written "Offer to Purchase. This is not a contract or sale." from each of the prospective buyers. We signed nothing. No money has exchanged hands.

Well, a talented, diligent, experienced realtor could handle this situation very easily. (Denita, are you here yet?) The oral "offer" isn't an agreement at all. The written "Offer to Purchase" is not a contract. In fact it says it right there. Your realtor should not have said to anyone, that the Seller accepts your offer. I really dont think a good realtor uses those words! And you should not have said that to the prospective purchasers, either. Are you in communication directly with the prospective purchasers? It doesn't seem strategic...

Every offer has conditions, right? And I'm sure if you read the fine print, there are several ways in which the buyer can slip out of contract, and that's AFTER it's signed. And I don't think a buyer generally considers their moral obligation to the seller, if their financing falls through (for example).

The purchase price is only one consideration in the sale. There is financing, time for closing, conditions, and those are only a few.

I personally don't believe you have any "moral" obligation to any of these purchasers. They are competitors (amongst each other), and you can deal with them fairly, honestly, and within the words of the written contract (and the law), but also negotiate a higher price, or a shorter escrow, or removal of certain conditions, based on the other offers you obtain.

I think your realtor needs to go to work here, and do his/her job, which is getting you the best offer that you can get, and help the deal through to closing. And speaking of the realtor, where I live, in many seller-realtor agreements, the seller owes the realtor the commission simply for bringing a full-price buyer (and there are certain conditions, of course). So, if we're speaking of moral obligations, by the direction of some of these comments, wouldn't that mean that if you settle for the lower offer that was first in line, that you then owe the realtor her/his commission based on the full-price offer you turn down?

Either your realtor is in over his/her head, or you have gotten ahead of yourself in this transaction.

Just got here:)

I think your Realtor misunderstands the process for highest and best - at least your post indicates that as it was described. In multiple offer process the seller would say to their agent (listing agent) that they are looking for highest and best. The listing agent would then go back to the two offers on the table and tell both of them exactly that: "highest and best offer due in writing by 4:00 pm on Wed Sept 21, 2018" as an example. This is a verbal counteroffer with nothing signed by the seller. The listing agent would also put that in the broker notes of the MLS so others can see this is a highly desirable house and bring their buyers in to see it right away. The period between countering with the highest and best verbal and the deadline is when you get more offers. Cutting out that period hurts you as a seller - as you can see. That period is very important and should not be skipped. The length of the period (the deadline) is determined by you, the seller, and your agent. But you don't want to make it too quick. I have found 3 to 4 days is an optimal period, sometimes even a day longer. The optimal length of the 'highest and best counteroffer period' depends on the market in your specific area.

However, you didn't do that. You verbally accepted the first offer. Did you make any changes to that offer? Did you make any change at all no matter how small (closing date, acceptance period, inspection period, earnest money deposit, loan commitment etc)? If so, then it is a counteroffer and you can withdraw your counteroffer. There will be specifics in the contract form for days to respond to a counteroffer and you can withdraw (usually) anytime prior to acceptance of the counteroffer. This is your out ethically.

Now that your agent actually said "accept" but didn't follow up in writing, you are in limbo ethically. Here you would not be under contract because you have nothing in writing but it is an ethical conundrum. You have made a verbal commitment to accept the offer the way it is and didn't sign it. Hopefully you made a counteroffer with some small change that you can now withdraw the counteroffer and ethically sign the highest offer. How long is the inspection period? In my area we can have a backup contract, subject to the first contract falling through. Most of our properties sell AS IS so the negotiated inspection period has a relatively high fall out rate as the buyer can cancel for any reason during the inspection period. The cancellation doesn't have to be inspection related either. So a backup contract is prudent. Your agents broker should be able to give you specific direction if your agent doesn't know.

Mrs S, if the seller doesn't accept the full price offer but sticks with the one that was verbally accepted (and follows up with written acceptance) the seller does NOT owe the commission on the offer(s) not accepted, even though it is at full price.

Denita, I read her post meaning that they accepted the offer AFTER requesting everyone to bring in their Highest and Best. So, I believe they did do the usual process, even if they did not maybe allow the three or four days that you alluded to.

Here it is in a nutshell... a verbal acceptance is not a legal, court enforceable contract. But, all parties really do expect to be treated fairly and ethically. It is up to the seller here to inform the agent how they want to handle the situation.

One thing to take into account is will the offer appraise at a price $8500 more than the next highest offer? If you do go with this offer, you may ask them to remove the financing contingency. Your agent probably thinks the house would not appraise, or she would have listed it at that price or above. So, it may not really be an acceptable offer anyhow.

One more note... a RE agent can not ask for highest and best more than one time with the same players involved. This is considered auctioneering, and we are not licensed to practice this.

ncrealestateguy, I read it as the listing agent presented two offers and suggested the seller accept the highest one of the two presented and then went back to the selling agent and conveyed a verbal acceptance. Then the 3rd offer was presented after listing agent conveyed verbal acceptance. OP, please clarify what actually happened.

In our area we ask one time for every agent to bring in their buyers 'highest and best' - it isn't auctioneering. In fact, we even have standard state forms for these notifications to buyers of multiple offers :) But the verbal counteroffer of 'bring in your highest and best' is the same to each and every buyers agent and is conveyed with a deadline and that is done only one time to everyone equally. When the deadline is reached, the seller reviews each of the offers and the pre-approvals (or POF if cash) to make the decision to select one offer with which to work or to select none.

ETA: ncrealestateguy - I hope you came through last weeks flooding unscathed. How are you doing?

I did not intend to suggest YOU were practicing as an auctioneer. I only added that note because I have had agents come back after asking for Highest and Best and then try to get another round of offers out of the parties.

We have forms for Highest and Best too, but I find an email to all parties easier and better for historical purposes.

All is well here after the storm. Only a roof leak.

Thank goodness you didn't flood.

Thank you all for the enlightening comments!

@Denita - Yes, we had offers from 2 separate buyers, then went through highest and best with these offers. The highest was verbally accepted. Hours later another offer came in from yet another buyer. This was for List Price.

(btw.. I did not directly contact the buyers or their agent. Sorry my text was confusing.)

My real estate agent had suggested to me that I accept the third bid (for list price... $8500 over the previous bid). She understands this is a business transaction; it was my conundrum about going back on my word. (If I were the buyer I would not be happy.)

@MrsS - What you said resonates with me: "...I don't think a buyer generally considers their moral obligation to the seller.....". This should help me sleep at night.

I told my agent that I would defer to her expertise in the matter. We'll see what happens.

The highest was verbally accepted. Hours later another offer came in from yet another buyer. This was for List Price.

For what it is worth, I think you should go with the offer you accepted.

When you say that you verbally accepted the offer, I assume it was actually verbal and not in an email. Is that correct?

Not only does it need to be in writing and signed by the seller, but it has to be delivered to either the buyer or the buyer's agent also, to be completely legal.

This has happened to my son TWICE while trying to buy a house in CT. In both cases, seller said to either meet the price of the new offer, or the deal is off. It was off, as far as my son was concerned.

It's SO much easier and such does not happen, in states where an offer is made, in writing (using a Board of Realtor's boiler-plate contract), and a "good faith" check is included (usually $1-3 thousand). The seller either accepts the offer and signs the contract or they don't. It must be signed immediately if accepted. At that point, if there were contingencies in the contract (obtaining financing, termite inspection, house inspection are just a few typical ones), those are done quickly and then a larger check for "earnest money" is sent to the seller and the house is truly under contract and a closing date is set. This avoids exactly what happened here.

One can make a case for going in either direction. I think I might go with the 2nd, not just because of the money, but the fact this couple wanted a house on the street where family lives. If you really are torn with guilt, tell them they need only pay $500 more than the other verbally accepted bid.

^Small correction to the above: earnest money doesn't go to the seller at all until closing. It goes to an escrow account/escrow agent. The escrow is usually either at the title co, or attorney's office or at the broker's co. Not the seller - that is too risky.

As to signing right away: the OP's agent did a disservice to the seller by not having a long enough period for multiple offers. The higher offers come during that multiple offer review period - usually toward the end of that review period and in some cases minutes before the deadline. The deadline is what makes the whole thing work best for sellers. It keeps the seller from the very issue she posted about originally where offer A has been verbally accepted and offer C was the highest and best but came in after the seller verbally accepted offer A. I do hope the OP updates us (if she can) when the property closes.

Decorating Ditz-

Long ago someone gave me some advice that I have found useful my whole life: "When you are faced with an ethical choice in a difficult situation, usually the harder thing to do is the right decision." In your case, foregoing the extra money may be the harder thing.

Good advice Kudzu9.

Anglophilia,

In what states are RE offers not presented on paper?

If an offer was accepted in text or email courts have considered that in writing.

The offer must have not been accepted in text or email, because her realtor suggested to take the 3rd bid ( $8,500 more).

@summersrhythm, we have no idea what her agent's communication style is with the other agent for acceptance. I can tell you from an agent POV (in my area) it is likely that the listing agent communicated via text or email as phone calls today have dropped down to practically zero unless the agent is in my generation (baby boomer).

Thanks for the input Denita. I am working with a couple realtors right now. The one is a baby boomer who likes to text, the younger one uses phone more often. I call them both ( I am not a baby boomer. :-) ). I was guessing her realtor didn’t use the text or email, or she won’t be able to accept the higher bid easily........ hopefully she got the $8,500 gain from the sale.

.......last year our realtor (a different baby boomer retired this year) called us when our offer was accepted on a property purchase. It was an hour after the offer was sent. The paper work came a few days later, the seller was in a different state. I think baby boomers could be all different too......

Yes, that's true. I am paperless and do everything with electronic signing so I don't understand taking days to get a contract signed when it has been accepted. Been paperless for almost two decades. But not everyone works that way. And you are right, it isn't age related at all, it's individual.

One thing that I haven't seen considered- if I missed it on the thread, I apologize:

But: Have the OP and Realtor really considered which of the buyers have the best ability- rock solid- to execute? I don't sneeze at extra $$, but I do wonder whether proper due diligence has yet been applied to the third buyer, or any of them.

Who has cash- verified? Who is approved for financing, with the down payment to make it so?

Perhaps this is already done, but it should be a big part of the considerations.

I have limited experience, but I know that the offers on my in-law's house in Westchester County, NY, were verbal, and the same was true when my son, in CT, bid on various properties over the years. There is no "boiler-plate" contract. It is verbal, inspections are done, financing is gotten, a lawyer draws up a contract, sends it to the buyer, whose lawyer reviews it and makes changes, back to the seller's lawyer (this can go on and on and on), and finally when a contract is agreed upon, it is signed by both parties. The same was true in MA when we sold property there about 30+ years ago.

In the midwest, it is general practice to have a signed boiler-place contract submitted (with a space on it for any contingencies).

"The one is a baby boomer who likes to text, the younger one uses phone more often. "

Which content of communication method would be held if there is a dispute?

Not from the phone call.

Personally I would never leave no evidence to back up any important decisions between myself and agents.

The original post is rather confusing, if the owner has decided to take the highest and best between the two initial offer after conferring with the listing agent, why did the agent accepted the 3rd one when it came in afterward?

Does it mean the agent over wrote the owner's wish? Or does it mean both the owner and agent are not following the procedures? What if there is another offer comes in now that is higher than the 3rd offer, how would they handle it?

I have limited experience, but I know that the offers on my in-law's house in Westchester County, NY, were verbal, and the same was true when my son, in CT, bid on various properties over the years. There is no "boiler-plate" contract. It is verbal, inspections are done, financing is gotten, a lawyer draws up a contract, sends it to the buyer, whose lawyer reviews it and makes changes, back to the seller's lawyer (this can go on and on and on), and finally when a contract is agreed upon, it is signed by both parties. The same was true in MA when we sold property there about 30+ years ago.

New York has a fairly common statute of frauds requirement as does MA and CT.

https://www.nysenate.gov/legislation/laws/GOB/5-701

Every agreement, promise or undertaking is void, unless it or some note or memorandum thereof be in writing, and subscribed by the party to be charged therewith, or by his lawful agent, if such agreement, promise or undertaking: [...]

1. Is a contract to pay compensation for services rendered in negotiating a loan, or in negotiating the purchase, sale, exchange, renting or leasing of any real estate or interest therein, or of a business opportunity, business, its good will, inventory, fixtures or an interest therein, including a majority of the voting stock interest in a corporation and including the creating of a partnership interest. "Negotiating" includes procuring an introduction to a party to the transaction or assisting in the negotiation or consummation of the transaction.

ETA to clarify: An offer can be verbal, but by the statute of frauds (which applies to real property in most every state) it is not enforceable unless it is in writing subscribed by the accepting party. Subscription is a bit complicated, but in most areas any written evidence by the party accepting an offer or their agent is sufficient to demonstrate acceptance. You can find a youtube video that walks you through your state's statute of frauds.

I've got a fair amount of experience in buying and selling real estate in a number of states, New York, Louisiana, Texas, Georgia, and Virginia. Without a doubt New York was the most difficult to conduct business. While the realtor can write an offer on the back of an envelope, it isn't enforceable until the lawyers write a purchase offer document and it's signed by all parties. That takes at least two weeks of being in legal limbo. It's a PIA. Most states and commonwealths have a simple series of boilerplate documents that are approved by their respective board of realtors to use. It takes an hour to be under contract in most states.

When we lived in New York, we found ourselves in a similar position as the poster. We had a purchase offer that was in the process of being drafted by the attorneys. (Please note that time is of the essence for everyone in this process but the attorneys.)

We really didn't like buyer #1. They were giving off signals that they were going to be trouble to deal with. Another potential buyer showed up within a day or so and needed a house asap. I happened to be home and showed the house. I told the second buyer's agent the status of the contract. I said if you will pay $1,000 more for this house, it's yours. I thought buyer #2 was going to be the stronger performer. They were more motivated. By offering me $1,000 more than buyer # 1 I believed that I could legally and in good conscience stop buyer #1 from proceeding. This was a case where the laws of New York and the Bar Association lobby worked in my favor.

How does this affect the OP? You probably don't have an enforceable contract even though you have given a verbal acceptance. Assess all of the offers and select the strongest one. It may not be the one with the highest price. Your realtor should advise you as to which offer is the strongest. That's how they earn their commission. There are a lot of things that go into analyzing the merits of the strongest offer, cash, financing, time frame, and motivation. While trying to acting ethically is always a good thing, you do have to analyze what is best for you and act accordingly.

"While trying to acting ethically is always a good thing, you do have to analyze what is best for you and act accordingly."

Wow! There are many ethical persons that would absolutely cringe at such a statements.

That advice is the absolute antithesis to acting ethically!

Saltidawg-

Let me summarize for you: it's good to behave ethically unless it's inconvenient..... ;-)

The OP's scenario is really quite simple... her and the first buyer were under a verbal contract, but the written offer was never signed nor delivered to the last party before they decided to withdraw the offer, and accept another one. It is legal to do, and it's level of ethics will be determined by each and every individual.

It is legal to do, and it's level of ethics will be determined by each and every individual.

The legality depends on your state and whether or not the offer was completely verbal. Some states have real estate laws that require the party accepting the offer attest doing so by signing, other states just use the general statute of frauds, which has absolutely no signing requirement. Often any affirmative written communication from the accepting party, to anyone (even an unrelated party), is sufficient to satisfy the statute of frauds. In some states any affirmative action on your part is sufficient to demonstrate acceptance.

If it was truly verbal you are probably safe. If you accepted it in an email or text to your realtor, then you should consult with your attorney.

ETA: I just want to clarify, there is a big difference between typical procedures and legal requirement. I suspect that the procedure in most areas are that a house is under contract when the seller has signed the offer and realistically made that signature somehow available to the buyer. However, the law gets really gray about what constitutes a signature and if it is required.

For example, I believe in North Carolina, a buyer must be notified (the modified mailbox rule applies) that a purchase agreement is signed for the contract to be binding.

This gets more complicated because in 2004 North Carolina accepted that any undisclaimed signature line on the bottom of an email constitutes a legally binding signature. This is the same for many states unless they specifically note how the offer must be accepted, which some do, others don't.

OP can you tell us how this is going??

All of this really has to do with how it works in your area. My area sounds similar to the OP's. We only have purchase offers, which is a non binding contract. Verbally accepting a highest and best offer really means nothing if another "better" offer comes in. The buyer has not spent any money on home inspections etc. She is free to accept whatever offer she wants until there is an actual contract. In my area, that takes two weeks. It happens with almost every transaction in a hot market. Take the offer that is best for you. Its a business decision.

Curious if there is an update on this. Am wondering how it all turned out. My brother is going thru something similar...

OP here.

I told my real estate agent to get me the best price on my house. (It wasn't up to me to decide how to do it; as others stated, it was strictly a business decision.)

My agent went back to the three offers with another "highest and best".

The potential buyers with the verbally-accepted offer dropped out. The buyers who had previously bid list price went to $5K over list. Unbelievable! (It seems they really want the cousins to grow up across the street from each other. So glad I can help out. Family <3. )

We signed contracts this afternoon. Hoping the appraisal goes well!

BTW we are in NYS.

Good for you! Thanks for the update and congrats!