Do counteroffers have to be in writing?

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10/22/2015 | Author: Editorial Staff

My client received an offer on his home. He wants to submit a counteroffer to the prospective buyer and asked me to call the buyer’s agent with the information. The buyer’s broker insists that the seller must either make a formal counteroffer in writing or reject the buyer’s offer in writing. Does my client have to respond in writing?

No. A seller has no legal duty to respond to an offer in any particular way. A verbal counteroffer could expedite negotiations for the sale of a property in many cases. Of course, once there is an agreement about the terms and conditions of the sale, the parties should promptly reduce the agreement to writing and sign the contract to make it a binding obligation.

A seller could respond to a buyer's offer by using the Seller's Invitation to Buyer to Submit New Offer (TAR 1926). This form would be particularly useful when the seller's proposal contains several changes to the buyer's offer. By using this form, the seller is free to consider other offers without having to be concerned about the withdrawal of a previous, written counteroffer.

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Categories: Legal, Buyers, Sellers
Tags: counteroffers, verbal agreements, legal faq


Rick DeVoss on 03/17/2016

To David (no last name)—-

You have found yourself in a very bad situation, and from the tone of your question, I sense you feel a moral obligation.  Perhaps we have all been there before…

Verbal offers (or counters) are merely guidelines so we will know what to put on paper.  Both parties should be informed that “verbal” doesn’t mean anything until you sign the contract.

But when you are sending offers to another agent in an email, the commitment becomes a little stronger.  An email IS in writing, but it is just not ‘signed’ by the parties.  The email could have been sent by one of the parties, and even acknowledged by the other party.  So then we would have a written “meeting of the minds.”  ~ Perhaps a judge would use these emails to determine the intentions of the parties.

But in the Real Estate world, we are hung up on signatures!
(I shall not comment on Docusign, since it seems to be a compromise between email documentation and real signatures.)

Have you considered that you had a situation where the seller and the buyer had Agreed to the terms of the contract?  ~Perhaps any offer that comes in after that should be relegated to a ‘back up’ status, and treated accordingly.

Did you notify all agents that you were in a multiple offer situation??  ~After that, you should have received their highest and best offers.  ...And then the seller would know what he was going to get.

You have a dilemma, because now you have broken the trust between you and the other agent.  That person will never again trust anything you tell them in an email.

Maybe it is time that our attorneys at TAR give us better instructions on how to deal with emails.  ...And how to handle multiple offer situations.

David on 03/16/2016

That’s is what my overall thoughts were.  However, when you read the articles on the subject they are a little ambiguous.  Thanks.

Joseph Stone on 03/16/2016


Sorry, your previous post mentioned that you had a question about “verbal offers”, so that’s what I replied about..

Re: your email conversation with the other agent, that is NOT an executed contract between the principals. An executed contract is a written document signed by BOTH principals in the transaction. 

Again, until you have a signed (executed) contract by both parties, you really have nothing..

David on 03/16/2016

I know that part in general.  However, my concern is in regards to electronic negotiations that took place via email between myself and the buyer’s agent.  Terms were agreed to via email.  The details are rather confusing in regards to what constitutes a contract via electronic communication ie email.

Joseph Stone on 03/16/2016

David…. No…  Until the ink is on the paper, nothing is binding… Both you and the other agent should know that and always let your respective clients know that. I have made phone calls to clients during very late hours to get something executed ASAP and they have never minded since I always explain that NOTHING is for sure until both parties sign the contract.

David on 03/16/2016

I have a quick question about verbal offers.  I have a multiple offer situation and sellers decided to go with one of them.  Told other agent about it said I’d get revisions over for their buyer’s signature.  Well, while waiting for seller to sign contract the other offer finally decided to play ball once I told them we were going with the other offer and countered with an offer my seller couldn’t refuse.  The other buyer’s are at their limit so, in looking out for my client and following their instructions we are going with the second offer that has now come up dramatically.  My question is that since the first offer was not signed and executed do we have any obligation to uphold the verbal agreement?  I have informed the other agent and have not heard back.

Rick DeVoss on 10/23/2015

About an email:  This remark may apply to Troy’s comment below, but it also applies to many other situations.  Even if the seller’s agent sends you an email saying that they will accept certain terms, you still do Not have a “contract” until it appears on some paper with the seller’s signature on it.  (Hopefully a TREC form.) 
It is possible for the seller to send an email to you directly, but I don’t think we have tested any case in court as to whether the seller’s “email” is a binding contract.
Now as far as “verbal” goes, you all know that any verbal statement is not a binding contract, so why are we having all these discussions??  ...It is possible to expedite the negotiations by passing verbal responses back and forth, but you still don’t have an executed contract until you get both signatures on the TREC contract form.
Personally, I like to use emails for counter offers, but you still have to respond promptly, and advise your client that the shows not over ‘til the fat lady sings.

Troy on 10/22/2015

In my experience, I have worked with buyers who have received a counter by email.  Once the email is received ,  if negotiations continue it has been verbally. By the initial counter being email is it correct in saying this would also constitute as written? Once agreement has been made any changes are applied to executed contract.

I also have seen several issues of submitting offers with no response or highest and best with no reply once an offer is accepted. This is especially true on foreclosures where after several weeks the listing is still showing active in MLS.  I tell my clients it’s due to slow response time from the listed bank but I wonder if this is just the bank waiting for a better offer.  It would be good know this so that my buyer could move on or consider resubmitting a higher bid at some point.

Jenna on 10/22/2015

@Joe - why do you assume I’m talking about so-so offers? My clients are on their third offer. The first offer we made was a full price offer. Instead of countering us, the agent waiting intentionally to try and create a multiple offer situation. He waited two days just to tell us he had another offer and he needed our “best and highest” but 5 pm Friday when we told him we would be pulling our offer if we didn’t get a response by then. He told us he had another offer and one “on the way,” which I hope came because we immediately backed out of. The second offer we made was $10,000 less thank asking price on a home that had been on the market 55 days and was too high priced for the condition it was currently in, which they accepted, but the agent still took so long to respond to the offer, then took forever to respond to requests made during the option. We got so frustrated because of their lack of follow through to make the house ready for inspection and their inability to respond back to emails (which I am assuming was their agent) we ended up terminating the contract before the option period was up. We made another offer full price offer last night, received a response immediately that he received the offer, he told me when we would plan on hearing back from his client, and received a call quickly to let us know of the small changes that needed to be made to the contract. Within 24 hours, we had an executed contract from a buyer who is very serious about buying. I have been a listing agent on several of occasions in this marketplace and I let my clients know that we always reply to every offer in 24 hours at least, either with a counter or a rejection, because we have already discussed what they will and won’t accept during the listing appointment and don’t need to spend days upon days deciding what they want to do. You are right - it’s all about educating the clients about these things and about telling each party to treat the other person as they’d want to be treated.

Joe on 10/22/2015


I have learned it’s all about playing the negotiating game in a Seller’s market. Seller’s sometimes are slow to reply to so-so offers, waiting for maybe something better. Like someone else mentioned, it’s good to make it known an offer is only good for a set period of time if you’re Buyer isn’t willing to wait it out. If a Buyer wants a better chance of receiving a quick executed contract, then the Buyer needs to make the offer good enough to make the Seller want to immediately execute! I’m a Listing Agent and a Buyer’s Agent and see both sides of the issue. As a Buyer’s Agent I always make my clients understand that a low offer may get a slow response or no response at all. As a Listing Agent I let my clients know that there’s no rush to quickly accept a low offer, especially when it’s a hot property…  I find that it’s really all about educating Buyers and Sellers and make them aware of how the current market is working. None of my Buyers should be getting their feelings hurt when a Sellers fails to immediately jump on their 10% under market value offer.

Joe on 10/22/2015

Where are all the agents I have dealt with in past. Almost every transaction I have worked in the past has involved going back and forth verbally before the agreed upon terms were put on paper and executed…???...???

Here in the Dallas /Fort Worth, TX. area it’s very unusual to mark up a contract over and over with signed counter offers.

MaryBeth Harrison on 10/22/2015

I strongly agree with several of the comments above. Encouraging verbal responses is adding to the unprofessional behavior we are already accused of. Buyers are already in an emotional state and being told they have an agreement only to have it pulled out from under them is unfortunate. I get that the listing agent’s responsibility is to get their seller the highest and best price. Maybe a solution is to give a deadline to accept offers or as suggested, use the form to resubmit offer. There is no room for verbal communication when contracts are involved. We are all busy but it’s your job to negotiate and get documents signed. With electronic signatures you do not even have to drive these days.

Jenna on 10/22/2015

I also am disappointed to see this article written. I have experienced, lately, that listing agents have become lazy in responding to offers, period. When a buyers agent sends an offer via email, I have had to track down an answer to an offer, and in some cases, even had to follow Up to see if the offer was received because I have received no correspondence back after 24 hours. I try not to start the home buying process by being strict with deadlines because we are in such a competitive marketplace that I don’t want to do anything to present the buyer in a bad light, and I also would like to assume that the agent on the other side is prompt with responses and communications. However, lately, it’s been pretty discouraging to see how many listing agents don’t feel the need to treat the buyer with respect and courteous communication, and I’m assuming it’s because they feel like with so much competition they don’t have to. They don’t realize how they are doing their client a great disservice by providing less than adequate customer service.

Debra West on 10/22/2015

I completed agree with Danny. By encouraging verbal offers/counter offers simply gives agents a method to be sloppy and careless. This method also causes hard feelings and disappointment with buyers/sellers when other written offers “slide” in and are excepted before the proposed written offer is actually completed.  We are the professional in the transaction and are aware that written accepted agreements bind our clients.  Why take shortcuts and possibly do harm to a client because it “expedites negotiations”?  In today’s electronic age we can have offers negotiated, signed and delivered within minutes.

Danny Steed on 10/22/2015

I’m really disappointed to see TAR editorial staff make the comment that “A verbal counteroffer could expedite negotiations for the sale of a property in many cases”. We understand that a seller has no legal duty to respond, but encouraging verbal offers or counteroffers in any way is just irresponsible advice.  We also understand that offers and counteroffers need to be in writing to be valid and enforceable. Taking shortcuts with verbal contract negotiations can ultimately create more problems than solutions. As a broker who is constantly training agents to protect the interests and positions of our clients, this post doesn’t help! Please encourage us to take the necessary steps to negotiate contracts correctly and responsibly. Our business is already fraught with enough ways to create misunderstandings and get ourselves, and our clients, in trouble.

Samuel on 10/22/2015

I had a case. My client made an offer on a listing and the listing agent, after consulting his seller, accepted our offer. All the negotiations were done by emails. Right after the acknowledgement of offer acceptance , we submitted our 1 - 4 Family Residential Contract to the seller. At the same time, the seller also received another offer, which I believe, was better than ours. The seller turned down our offer at this stage.  In this case, was our offer a verbal or written?

Debbie Russell on 10/22/2015

It is silly to NOT use the “Seller’s Invitation TAR-1926” using this document make’s it clear that the seller is free to negotiate other offers; particularly in a market where it is common to have multiple offers.

Joe on 10/22/2015

Agreed that negotiating verbally can and is done, HOWEVER, until the ink is on the paper nothing is binding. I once had clients that had verbally expressed a counter offer. The other party took their time deciding and didn’t immediately reply to the counter. In the meantime another MUCH better offer came in. My clients immediately notified the other part that their counter off was now off of the table and then accepted the much better offer that came in.

I always explain to clients that if they get an acceptable offer to execute immediately, otherwise it can disappear just as fast as it appears.

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