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Wait until you get both written offers! you never know if something comes up and the company that provide the verbal offer is not able to move forward due to politics.
I don’t think there’s anything wrong with that. You can be excited about a position but more excited about another.
Hopefully you get a written offer from 2 soon. Then tell company 1 you are taking the 2 offer. If they come back with more money. Go to 2 and mention that when you talked to 1 they threw more money your way. Don’t demand more money from 2, but ask if there is any that they can do. It comes off less aggressive and keeps them from pulling the offer and you coming back groveling.
Company 1 is likely giving me the written offer after one last chat with the hiring manager. Pays more and will also be a lot more stressful, from what I’ve taken away from my interviews. And a few other red flags have popped up during these interviews.
Do I tell hiring manager during my final check in? Do I wait til I get both offers in writing and once a decision is made then I disclose? I don’t want to burn bridges with company 1.
Wait, you have nothing to lose. You’re not the first one who does that… it’s ok to keep going even if you won’t accept the offer
If you end up with two offers, you'll need to tell one of them that old quote from the Brady Bunch:
"Something suddenly came up".
I would probably wait until you at least have a written offer letter from Company 1 to tell Company 2 you aren't taking it. Once you have a written offer letter, I would go ahead and let them know. That way they can proceed with their other candidates.
Get the offer then make a decision.