Canceling a Counter Offer
Q: Hi Doug. We recently submitted an offer on a San Ramon home for sale. We have bought and sold several homes, so we are not beginners. We absolutely loved this house, and we were delighted to get a counter offer from the seller. The counter offer expired the following day at 5:00 PM. We had to check on a couple of things with our lender before signing it, but we definitely planned on signing it by the 5:00 PM deadline. At about 3:00, we got word from our agent that the counter offer was cancelled. That seems really unfair! Needless to say we were devastated that the seller did not let us respond first. Can the seller do that? Amy in San Ramon
A: Thanks for the question Amy. I can certainly understand how upsetting it is to you, and how unfair it must seem. The short answer to your question is yes, the seller has the legal right to cancel (rescind) their counter offer before it is signed. It may seem unfair, but the seller has the legal right to do that. Usually it is because the seller received a better offer, and no longer felt the terms on the counter offer they sent you were good enough. I know it is disappointing, but the law is the law. In general, the seller is perfectly entitled to act in their best interest, and as long as the buyer had not yet signed the counter offer, they can rescind it.
The same goes for the buyer by the way. The buyer is free to withdraw their offer any time before the seller signs it. My best advice is when you get a counter offer that is acceptable, sign it. A lot of things happen if you wait, and many of them are bad. In a hot market like we are experiencing, things move fast, so be sure you are geared up for the pace of the market. As always, be sure to check with your attorney for legal advice. Happy hunting!