Has anyone here used an escalation clause in an offer to buy a home? Boston suburbs (Western side). Pros/cons here? Our real estate agent hasn’t said anything about it, so I thought I’d get some intel before asking

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If you are confident of a tough fight and definitely want to get the home, you can use it. However you will give up a lot of negotiating power in this and most likely be ready to pay somewhere near to your upper limit.

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If you have a good agent, you shouldn’t need this - and should just be able to continue negotiating or offer best and final when asked. As a seller previously, I was turned off my the escalation clauses personally in some of the offers we got.

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I’ve used it before. The issue is that all offers are not created equal, and you’re simplifying it to $ with an escalation clause. They could easily get a weaker overall offer but higher price and still prefer yours, but with an escalation clause you automatically match up to a certain amount.

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Makes perfect sense. Thank you

Gotcha. To understand better, what exactly are the down sides to using it? With all the multi bidder scenarios these days on hot houses, it feels like the seller would have nothing to lose if we put in a strong offer with an even stronger escalation cap.

FWIW, we got two good offers for the last home we sold. It was listed as a “Hot Home” on Redfin and we had close to a hundred people during the open house. The first was an all-
cash offer at asking and the buyer was okay with a flexible closing. The second offer was at asking with an escalation clause of 20k cap but the buyers wanted a quicker closing. We met the second buyers mid-way at 10K over but in hind sight, we could probably have gotten close to the full 20k. We did that by asking them to drop all conditions in light of other other competitive offers we had received (that way we didn’t have to show them the other offer).

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