"Active with Backups"

For a long, long time, it was really wild out there. In most cases, homes are still receiving multiple offers once they hit the market. As a buyer, you may be confused by some of the lingo surrounding the homebuying process. For example, what does it mean when a listing is “active with backup offers”? Like… what? 

Here’s the Sitch

This scenario occurs when the buyer has a home to sell, and it has an accepted offer but has not closed. Essentially, the sellers are allowing additional offers to come in while the current agreement is in escrow. With this option, the seller is allowed to continue advertising and entertaining additional offers in case the first accepted offer falls through. 

Isn’t this just a case of having your cake and eating it, too? Not really, because this does not just benefit the seller. This contingency would release the purchaser out of the contract should his previous residence not sell.

“In today’s market, some buyers have a stipulation that they have to sell their house in order to buy the new one and their old house isn’t under contract yet,” says Jennifer Murtland, team leader for Team Synergi Real Estate in Cincinnati. So having this provision in their contract could prove beneficial. 

Keep in mind, though, that if you are the buyer making a backup offer, it’s still legally binding. If the first offer does indeed fall through and you’re next in line, it is absolutely, 100% an official offer. 

If you have more questions about active listings accepting backup offers, visit Realtor.com.