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Check The Competition
We made an offer on a home. The listing broker said there are three more offers and we have to increase our bid. The other offers, like ours, are all cash. How can we find out if there are competing bids and if they are higher than ours? If we raise and win (or lose) can we require the broker to show the other offers?
The simple answer is no – there’s no way to see competing offers on a home before a transaction is made.
As a bidder, you want pay as little as possible for the property, while the owner – and the owner's representative – want to maximize the sale price. Everyone gets that.
So, the listing broker says you should increase your bid in order to compete against other bidders. But you have not actually seen the other offers. If they are “higher” than your offer, just how much higher are they? You don't know.
Not unreasonably, you want evidence that there are other bids. You do not want to overbid. However, think about it this way: Would you want another potential buyer to see your bid?
This is a situation without a solution: If you don't see other bids, you may worry that you overpaid. If you do see the competing bids, that compromises the bargaining position of the competing buyers. Moreover, even if you were to see other bids somehow, you don't know that the competing bidders have the capacity to conclude the transaction.
If you lose the home, the final purchase price of the property will be public record once the sale has processed, but that doesn’t help you right now.
The answer, I suspect, goes like this: The property has a particular economic value to you. You should not bid any more than the property is worth for your purposes.
If that means you lose the property – but don't make a bad deal – that's fine. There are other properties on the market and, as an all-cash buyer, you should have plenty of leverage to get the home you want.
Peter G. Miller is the author of The Common-Sense Mortgage and a veteran real estate columnist. Have a question? Please write to email@example.com.View Foreclosure Article Archives
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