Yes, you can still make an offer on a house that’s under contract. Sellers are allowed to accept a second offer in backup position, which sits behind the existing contract and only becomes binding if the first deal falls apart. About 6% of contracts terminate before closing in a typical month, and that number has climbed past 16% in competitive markets with volatile financing. So backup offers activate more often than most buyers assume.
What “Under Contract” Actually Means for a New Offer
When a listing shows “under contract” or “pending,” the seller has already signed a binding purchase agreement with a buyer. They can’t tear that up because a better offer arrives. But they remain the legal owner until the deed is recorded at closing, and that ownership lets them sign additional agreements that sit behind the primary contract, ready to activate if it collapses.
The listing status tells you whether the seller is open to a second offer. “Contingent” or “active under contract” usually means the deal has unresolved conditions and the seller is still accepting showings and backup offers. “Pending,” especially “pending no show,” signals the sale is on track and the seller has stopped entertaining alternatives. Language like “contingent continue to show,” “pending taking backups,” or “backup offers welcome” is an explicit invitation.
Even without that language, it’s worth asking. Listing agents will often tell your agent whether the seller wants to see backup offers, since a backup costs the seller nothing and protects them if the first buyer falls out.
How a Backup Offer Works
A backup offer is a fully signed purchase agreement that sits in second position. It only becomes enforceable if the primary contract is canceled, terminated, or expires. For the seller, it’s insurance: if the first buyer can’t close, there’s already a signed agreement in hand, no relisting, no lost weeks on market.
The document looks like any other purchase offer with one addition. It includes a backup addendum stating the agreement is contingent on the termination of the prior contract. Without that language, you could theoretically be bound to buy the home while the first buyer’s deal is still alive. Sellers can’t hold two primary contracts at once, but the backup addendum creates a secondary obligation that only activates when the first contract dies. The seller isn’t breaking any commitment to the first buyer by signing it.
Reading the Weak Points in the First Deal
Before you write a backup offer, try to learn which contingencies protect the primary buyer. Your agent can often get this from the listing agent without breaching confidentiality, since the existence of contingencies is commonly disclosed even when the specific terms are not.
The most common contract-killers are financing problems, low appraisals, and inspection findings. An FHA buyer with 3.5% down faces stricter property condition rules than a conventional buyer; if inspection turns up health or safety issues and the seller won’t repair them, the lender may refuse to fund. Appraisal shortfalls are another regular deal-breaker: if the home doesn’t appraise at the contract price, the buyer has to cover the gap in cash or renegotiate. And a home sale contingency, where the primary buyer must sell their current home first, is one of the weakest positions a buyer can hold. That’s the scenario most likely to create an opening for you.
How to Submit a Backup Offer
The mechanics are straightforward, but the paperwork has to be precise.
- Prepare a full purchase offer with price, financing terms, closing timeline, and contingencies. Add a backup addendum stating the offer is contingent on termination of the prior contract.
- Address earnest money. Deposits for residential deals typically run 1% to 3% of the price, higher in competitive markets. Your backup agreement should specify whether the deposit goes into escrow immediately or only when the offer moves to primary position. Most buyers prefer the second approach so funds aren’t tied up indefinitely.
- Deliver the package through your agent to the listing agent. Electronic signature platforms handle most of this now.
- Wait for the seller’s review. If the seller signs the backup addendum, you receive a fully executed copy confirming your position.
Signing a backup offer doesn’t freeze you out of the rest of the market. You can and should keep looking. Just make sure your backup agreement includes a withdrawal mechanism, because if it activates after you’ve committed elsewhere, you’ll need a clean way out.
Making Your Offer Attractive Without Overpaying
A backup offer doesn’t need to beat the primary buyer’s price. Sellers accepting backups are hedging against risk, so what they want is certainty. Focus on the parts of the offer that signal reliability:
- Cleaner contingencies. Waiving a home sale contingency, shortening the inspection period, or showing strong preapproval makes you look more dependable than a primary buyer whose deal is wobbling.
- Flexible closing timeline. If you can close on the seller’s preferred schedule, you remove friction the first buyer may be creating.
- A fair price rather than an inflated one. The seller already has a number locked in. What they’re evaluating is whether your offer will close.
- Proof of funds or a strong preapproval letter. This is the fastest signal that your deal won’t collapse for the same financing reasons that may be threatening the primary contract.
The Kick-Out Clause
Some purchase contracts include a kick-out clause, sometimes called a 72-hour clause, that lets the seller force the primary buyer’s hand. It’s most common when the first buyer has a home sale contingency.
Under a kick-out clause, the seller keeps showing the home after accepting the first offer. When a stronger second offer arrives, the seller notifies the primary buyer that the clause has been triggered. The primary buyer then has a set window, usually 24 to 72 hours, to either remove their contingency and commit fully or walk away. If they don’t respond in time, the contract voids and the seller moves forward with the new buyer.
Many buyers with a home sale contingency can’t remove it on a tight deadline because their own sale is genuinely uncertain. That’s the opening a backup buyer walks through. If the contract you’re targeting has a kick-out clause, your backup offer isn’t only a safety net for the seller; it’s the trigger that forces a resolution.
Your Right to Withdraw
Sitting in backup position can take weeks. During that time you might find a home you like better. Whether you can withdraw cleanly depends on the language in your backup agreement.
Many backup addenda include a right-to-withdraw clause allowing you to cancel in writing any time before your offer moves to primary position. The typical language: until you receive written notice that the seller is no longer bound to the primary buyer, you may withdraw by notifying the seller or their agent in writing. Once you receive that notice and the backup becomes primary, withdrawal rights end and standard termination provisions take over.
If your backup agreement doesn’t include a withdrawal clause, you may be locked in until the primary deal either closes or falls apart. Ask your agent to include one before you sign. It costs you nothing in bargaining power.
What Happens if Your Backup Activates
If the first deal collapses, the seller notifies your agent in writing that your backup offer has moved to primary position. That notice starts your transaction.
In most backup agreements, the effective date of the contract resets to the date you receive the notice. All of your deadlines, inspection period, financing contingency window, deposit due dates, run from that new date rather than the day you originally signed. You aren’t penalized for the time the offer sat in secondary position.
From there, the process is any home purchase: schedule the inspection, finalize the loan application, work toward closing. Stay on top of every deadline. Missing a contractual obligation during this phase can cost you your earnest money, the same as in any standard purchase agreement.
Risks Worth Weighing First
Backup offers are useful, but the costs are easy to underestimate.
Opportunity cost is the biggest one. While you wait for a primary deal to fall apart, other homes come on the market and go under contract. Buyers who become emotionally anchored to the backup property stop searching actively and miss better fits. Treat the backup offer as a bonus possibility and keep touring.
Uncertainty is the second cost. You have no control over the primary buyer’s timeline. The wait can stretch for weeks without updates, and most first contracts do close: roughly 94% of deals make it to closing in a normal month. Your backup is more likely to expire unused than to activate.
And if your earnest money went into escrow immediately rather than on activation, those funds are tied up until the situation resolves, which can limit your ability to make offers elsewhere. A deposit-upon-activation structure and a withdrawal clause solve both problems.