Seller had accepted my offer and sent me a contract. Sent signed contract (signed by me, not seller) and deposit check to my lawyer yesterday. Last night got an email from my broker saying seller decided to take an all-cash offer instead of mine. Seller's broker claims she didn't know anything about other potential buyer. I know that sellers can do this before the contract is signed, but isn't it really bad faith? It seems unlikely that the seller's broker really didn't know what was going on. Also, it seems weird to me that the seller didn't give me the opportunity to make a higher bid. Does anyone have any insight into situations like this?

happens every day

What seemed strange was that the seller's agent seemed to imply that the seller had been negotiating on the side without the agent's knowledge for a while. Wouldn't it have been to the seller's advantage for me (and the seller's agent) to know about the other potential buyer? I might have made a higher offer -- maybe even high enough to mitigate the fact that there was financing involved. Or I might have made a higher offer and the all-cash buyer might have met it. Am I missing something?

No, you're not missing anything. The seller likely used you to get the cash buyer to increase his bid.

Sure, the seller could have come back to you, but what if the cash buyer had a firm deadline and you ended up passing? Bird in hand...

I think you are right that the seller just used my bid to get the all-cash buyer to up his offer.

In the meantime I wasted several weeks of my life negotiating, hiring a lawyer, preparing the board package, etc. And I spent over a thousand dollars in legal fees. Also, I really, really liked the apartment.

the world of manhattan re. Im seeing this more these days lately with our clients, similar to how it was back in April, May & early June. Its the lack of quality/well priced product thats doing it. Not much you can do as there is little you can do about outside offers coming in prior to a fully executed contract. Yes its risky, even going back to original buyer is risky as some buyers will hate that a game is being played and perhaps withdraw the offer. But thats the sellers call. However, the board package is something that should not be started until the deal is fully executed. For the next deal, wait on that until the contracts are signed.

Yeah--confused as to why you began prepping board pkg without signed deal. Also, what on earth were you paying a grand in legal fees on this early in the game? That seems high to me.

Cash offer always wins.

did you get you get a quote from your attorney in advance that they only get paid if the deals goes into signing? my attorney outlined before i even started that they will only get paid if i signed, or if i'm rejected by the condo board (which almost never happens), then there's a 25% discount.

Yes, the problem seems to be that there's just not a lot of inventory. Now that I've lost out on this apartment, I don't really see anything else out there that appeals to me.

The deal with the lawyer was that he would do the closing for a flat fee, half up front and the remainder only if the deal closed. Not sure if he will give me a break if I eventually go back to him with another property.

Fortunately I didn't do a huge amount of work on the board package--just started getting letters of recommendation.

I guess what really bothers me about all this is that I think I was being used for weeks. I get the sense that the seller never really intended to do a deal with me. I think he was acting in bad faith from the beginning.

Yes, I think you're right on all counts. Thanks.

And maybe the seller has accummulated so much bad karma that his all-cash buyer will end up with a board turn-down.

Or maybe Hurricane Sandy will just wash the whole building away.

Just checked the listing again, and the apartment in question is still listed as "for sale," not "in contract." What could have happened here? I am feeling really confused. The sellers accepted my offer, sent a contract then refused to sign it, claimed they had an all-cash offer, but now seem not to? And no one has contacted me to ask if maybe I still want the apartment? On top of that, I've been emailing my broker to try to find out what's going on, and she doesn't respond to my emails. This all seems very weird.

Already had financing through private banking relationship. Seller knew this.

Attorney took a few days. And did add a one-page rider. Sounds like I should have pressed for faster turnaround time.