A back-up offer is an offer your seller formally accepts while a different buyer’s agreement is already on the table, structured so it has no effect at all unless that first deal collapses. As one Ontario real estate lawyer and broker puts it describing exactly this situation: “Bill’s Offer, if accepted, is a ‘back up’ Offer. It was never a competing Offer with Bob’s.” It only comes alive at one specific moment: “The moment the Agreement falls apart and becomes ‘null and void’, Bill’s Offer comes into play.”
Be precise with clients about what this term actually is: neither the RECO Information Guide nor a TRESA bulletin located for this page defines “back-up offer” as a formal status. It is real estate practice terminology, not a regulator-defined one, so do not present it to a client as though it carries a fixed legal meaning beyond what the accepted offer itself says.
What RECO does regulate, and what still governs a back-up offer situation, is disclosure. A buyer who has made an offer is entitled to know only the number of competing offers; the content — price and terms — is the seller’s choice, requires the seller’s clear written direction before it can be shared, and personal or identifying information contained in an offer cannot be shared regardless. RECO also runs a direct verification channel on the number itself: it will “request that the seller’s brokerage confirm the number of offers that were received by the brokerage and conveyed to the seller,” available to a buyer who actually made an offer or their agent, not to the public. A back-up offer is, functionally, one of the seller’s three procedural options on receiving multiple offers — accept, sign back, or ask for best and final — exercised as “accept, contingent on the first deal failing,” rather than a separate legal category.
Your seller accepts Buyer A’s conditional offer. Buyer B then submits a back-up offer, which your seller also accepts, expressly contingent on Buyer A’s agreement becoming null and void. Buyer A’s financing condition is not waived or fulfilled by its deadline, so the primary agreement automatically dies — and only at that point does Buyer B’s back-up offer become the live deal. Throughout, you may tell Buyer B’s agent that a back-up offer situation exists and that another agreement is outstanding, but you cannot reveal Buyer A’s price or terms without your seller’s written direction.
See also: conditionally sold vs firm sold and the escape clause.
A 30-minute call is enough to tell you whether AI pays for itself here.
