What Is a Backup Offer in Washington Real Estate?

A backup offer is an offer accepted subject to the existing sale not closing and the backup agreement’s terms. It can give a buyer another opportunity at a home and give the seller a possible alternative if the first transaction ends. It does not let the seller replace the first buyer simply because a better offer arrives.

When The Madrona Group recommends a backup offer

Backup offers are uncommon in our practice. We generally consider one when a buyer loves a particular home, is genuinely disappointed to have missed it and feels strongly enough about it to wait. It may also be worth exploring when there is a credible concern that the first transaction will not close.

We start with a conversation with the listing agent. How is the transaction progressing? Are there unresolved issues that the seller is able to share? Does the agent express uncertainty about financing or another part of the transaction? That conversation can help us assess the situation, but it cannot promise that the first sale will fail.

We do not give buyers a percentage chance of getting the home. The outcome depends on another transaction, and much of that transaction’s information may be confidential. A backup offer should fit the buyer’s goals even with that uncertainty.

Three choices for a buyer who missed the home

Submit a formal backup offer. This may make sense when this is the home you strongly want and you understand the obligations, timing and exit provisions before signing.

Ask the listing agent to stay in touch. Expressing continued interest can keep the conversation open, but it does not create the contractual position of an accepted backup offer.

Move on and keep searching. Sometimes the better decision is to focus on available homes. Waiting for one property can distract you from another that fits just as well, or better.

Understand what you are committing to

Being in backup position does not mean there is no contract. Before signing, review the purchase terms, any expiration or termination rights, earnest money requirements, and the notices or events that start inspection, financing and closing deadlines. Have your broker explain what happens if the first sale closes and what happens if it does not.

Do not assume a conversation saying “the first deal fell apart” completes the required process. Follow the signed agreement’s notice requirements. Similarly, before committing to a different property, confirm how to end any existing backup obligations so you do not unintentionally become committed to two purchases.

How a backup offer can help a seller negotiate

A credible backup can change the seller’s negotiating position. For example, suppose the first buyer requests a $25,000 inspection credit, and the seller has an accepted backup with terms that are as good or better. The seller may feel more comfortable declining that request or offering a smaller concession. This is an illustration, not a promise that the backup buyer will close.

The Madrona Group would compare the actual alternatives: the first buyer’s requested credit, the strength of the backup, possible delays and the risk of starting another inspection or financing process. A backup buyer may raise the same property concerns. A higher price alone does not make that offer the better outcome.

Any discussion of a backup must be accurate and respect confidentiality. Having another buyer available can support a firmer negotiating position, but it does not erase the seller’s obligations to the first buyer. Declining a new repair request is different from refusing work the seller has already agreed to complete.

A better backup does not cancel the first sale

The seller must continue to follow the first agreement. A missed deadline, financing concern or disagreement over repairs does not mean the seller should assume that agreement has ended. The applicable contract rights, notices and termination procedures need to be reviewed before proceeding with another buyer. Seek legal advice if the parties dispute whether the first contract is still binding.

Backup offers and sale-contingency bump offers are different

Washington REALTORS distinguishes the Form 38A backup addendum from Form 39, the second buyer’s addendum, used in the home-sale-contingency context. They are not interchangeable. Your broker should match the paperwork to the actual situation.

If the first buyer needs to sell a home and the seller is considering a bump notice, read our Form 22B guide. For the form distinction, see Washington REALTORS’ “Mistaken Identity: Forms, Part 5” discussion.

What our office experience has taught us

We have seen successful backup purchases handled by colleagues in our office. The practical lesson from those transactions is to keep expectations realistic: it can happen, but it requires the first transaction not to close and the backup buyer to remain willing and able to proceed.

We would only recommend waiting when the buyer feels strongly about the home or there is a meaningful reason to question the first transaction’s progress. Even then, we discuss the tradeoff. A chance at this house should not quietly become weeks of missing other opportunities.

Talk with The Madrona Group about whether a formal backup, continued contact with the listing agent or moving on makes the most sense for your situation.

Frequently asked questions