By Dave Naso, Chicago Association of REALTORS®
When a listing goes live in a low-inventory market with strong buyer demand, the clock starts ticking: a buyer texts their REALTOR® within minutes, rearranges their day for a showing and starts imagining life in the home, only to learn they’re not the only one interested. In these high-stakes moments, multiple offer situations can feel personal, urgent and emotional, making a REALTOR®’s steady guidance critical to setting expectations, explaining options and helping clients move forward with confidence.
Whether representing the buyer or the seller, REALTORS® must navigate these situations carefully to avoid potential violations of the REALTOR® Code of Ethics. Below are common scenarios that may arise when multiple offers are on the table, along with guidance on how the Code of Ethics can help inform your actions.
Setting Offer Conditions Without the Seller’s Written Direction
Listing agents are obligated to present all offers to their sellers unless the seller has waived, in writing, specific circumstances in which an agent can withhold presentation of an offer. Without such written direction, a listing agent cannot withhold presentation of any offer based on a specific contract type used, or its terms, such as escalation clauses, financing or buyer broker compensation. Without the specific written direction from the seller to withhold submitting the offer, a listing agent must submit all offers to their seller. Then the seller may, if they choose to counter, address these terms in their counteroffer.
This obligation is mentioned in Article 1 of the Code of Ethics, supported by Standards of Practice 1-6 and 1-7 which read in part:
1-6: REALTORS® shall submit offers and counter-offers objectively and as quickly as possible.
1-7: When acting as listing brokers, REALTORS® shall continue to submit to the seller/landlord all offers and counter-offers until closing or execution of a lease unless the seller/landlord has waived this obligation in writing.
Listing agents can follow these four steps to ensure adherence to the Code of Ethics:
- Present all offers unless directed otherwise in writing. If you do not have written instructions from the seller, present every offer received, regardless of contract type, financing terms, escalation clauses or buyer broker compensation.
- Review the seller’s written instructions. Confirm whether the seller has provided written direction waiving presentation of certain offers under specific circumstances.
- Let the seller decide how to respond. Once the offer is presented, the seller can accept, reject or counter. If the seller chooses to counter, they can address any terms they want changed in the counteroffer.
- Document the process. Keep clear records of the offer presentation and any written seller instructions related to withholding offers.
Refusing to Affirm an Offer Has Been Submitted to a Seller
When a buyer’s broker submits an offer on behalf of their buyer, it is common to ask the listing agent to confirm receipt of the offer. When the buyer’s agent doesn’t receive a response, or a listing agent responds stating they won’t submit the offer to the seller because of a certain term contained in the offer, the buyer’s agent may look to the REALTOR® Code of Ethics for guidance.
Article 1, supported by Standard of Practice 1-7 reads in part: Upon the written request of a cooperating broker who submits an offer to the listing broker, the listing broker shall provide, as soon as practical, a written affirmation to the cooperating broker stating that the offer has been submitted to the seller/landlord, or a written notification that the seller/ landlord has waived the obligation to have the offer presented.
When a buyer’s broker is in this situation, they should make a clear and written request to the listing agent asking that they affirm in writing that their buyer’s offer has been submitted to the seller. If it was not, written affirmation from the listing broker confirming that the seller has waived this obligation is required under Standard of Practice 1-7.
Listing agents can follow these five steps to ensure adherence to the Code of Ethics:
- Confirm receipt of the offer. When a cooperating broker submits an offer, acknowledge receipt when asked.
- Submit the offer to the seller unless there is a written waiver. Unless the seller has waived the obligation in writing, the offer should be presented to the seller.
- Respond to written requests from the cooperating broker. If the buyer’s broker makes a written request, provide written affirmation that the offer was submitted to the seller as soon as practical.
- Provide written notice if the seller waived presentation. If the offer was not presented because the seller waived that obligation, provide written notification of the seller’s waiver as required by Standard of Practice 1-7.
- Keep records. Maintain documentation of the offer, the seller’s written waiver if applicable and any written affirmations or notices provided to the cooperating broker.
Buyer’s agents can follow these five steps to ensure adherence to the Code of Ethics:
- Submit the offer in writing. Make sure the offer is clearly delivered to the listing agent and keep a record of when and how it was sent.
- Ask for confirmation of receipt. It is appropriate to ask the listing agent to confirm they received the offer.
- Make a written request for affirmation. If you do not receive a response, or if the listing agent says the offer will not be submitted because of a specific term, send a clear written request asking the listing agent to affirm that the offer was presented to the seller.
- Request written notice if the offer was not presented. Under Standard of Practice 1-7, if the seller has waived the obligation to have the offer presented, the listing broker must provide written notification of that waiver as soon as practical.
- Document the communication. Keep copies of the offer, your request for written affirmation and any response from the listing agent.
Disclosing the Existence of Other Offers
Whether you are the listing agent or the buyer’s agent, Article 1, supported by Standard of Practice 1-15, can provide guidance on how to handle inquiries of multiple offers.
For a buyer’s broker, let’s say you submit an offer on behalf of your buyer, and the topic of multiple offers never comes up with the listing agent. The offer is being negotiated with the seller, and the parties are close to agreeing on all contract terms. Before a contract is finalized, the listing agent informs you that the seller has decided to move forward with a different buyer who submitted another offer. You and your buyer may feel that you should have known about the other offer or been given the opportunity to submit a highest and best offer. This is a common misunderstanding and one that should be known and explained to the buyer in advance by their broker.
Standard of Practice 1-15 reads in part: REALTORS®, in response to inquiries from buyers or cooperating brokers shall, with the sellers’ approval, disclose the existence of offers on the property.
In practice, this means a buyer’s agent may ask the listing agent whether other offers exist. Before a listing agent discloses that information, two conditions must be met: the listing agent must receive an inquiry from the buyer or buyer’s broker, and the seller must approve the disclosure.
Remember that Article 1 is about protecting and promoting the best interest of your client, which also includes preserving confidential information as outlined in Standard of Practice 1-9. The seller may decide not to disclose the existence of multiple offers as it would be in their best interest not to have that information known. The decision to disclose, or the decision to call for highest and best, is at the direction of the seller.
How does a listing agent ethically respond to an inquiry as to whether there are other offers on the property? If they do not have permission from their seller to disclose this information, even if there are no other offers submitted, the listing agent should respond along the lines of “I do not have permission to disclose that information at this time.” Even answering “No” to this inquiry when there are no offers submitted may be a violation of Article 1 if you do not have your seller’s permission to disclose that information. And, most importantly, the listing agent, as well as all REALTORS®, has an obligation to be honest to all parties as a core obligation of Article 1.
A buyer’s agent may initially view the refusal to answer the question as being unfair, but the principle of Article 1 is protecting and promoting the best interests of your client, and a seller may choose not to authorize the disclosure of other offers because it puts them in a better negotiating position. So, all REALTORS® should ensure that all communication around a multiple offers situation or client direction is done in writing and properly documented to protect themselves and their clients.
Missing Key Deadlines
After your buyer successfully wins a multiple offer scenario and a fully executed contract is signed, the terms agreed to must be followed by your buyer to avoid a potential breach of the contract.
As an example, a contract might set specific deadlines for delivery of earnest money. The buyer is contractually obligated to deliver funds in accordance with the terms of the contract. As a buyer’s agent, when drafting the original offer, ensure you have a conversation with your buyer about term deadlines. When discussing terms such as delivering earnest money, enter in realistic timeframes so that the buyer can reasonably comply.
Additionally, be cautious of taking on personal responsibility for delivery of those funds. If you as the buyer’s agent offer to deliver your buyer’s earnest money on their behalf, you are taking considerable risk if you fail to deliver the funds in accordance with the contract. Missing an earnest money delivery deadline could allow the seller to declare the buyer in breach of the contract, allowing them to terminate the contract and move forward with a different buyer.
Set proper expectations with your buyer, discuss realistic terms and be aware of the risks associated with personally delivering earnest money to avoid potential violations of:
- Article 1, protecting and promoting your client’s best interest; and
- Article 11, competencies reasonably expected of your services.
Multiple offer situations can be fast-moving and emotionally charged, but the REALTOR® Code of Ethics provides clarity when the stakes are high. By understanding and applying its principles, REALTORS® can deliver the highest standard of service while guiding clients through competitive situations with confidence, transparency and care. This ethical commitment is part of the REALTOR® difference, strengthening client trust and demonstrating the professionalism that sets REALTORS® apart. REALTORS® can also help avoid many ethical questions by setting expectations early with clients and communicating
clearly with other brokers.
If you believe that a REALTOR®’s conduct may have violated the Code of Ethics, the Chicago Association of REALTORS® offers both formal and informal dispute resolution services as a member benefit. Click here to learn more about available resources and next steps.