What is a backup offer, and how does it work in Texas?

A backup offer is an offer you make on a house that already has a signed contract with another buyer, so you are in second position if that contract is canceled. Once you and the seller both sign it, it becomes a backup contract, which binds both of you from that moment. While the first contract is still in place, the only thing you have to do is deliver your earnest money to the title company. If you want an option period, a number of days when you can get out of the contract without giving a reason, you also deliver the option fee to the title company.

Sometimes the house you like already has a signed contract when you see it. If you are buying a home, this explains how a backup offer works and what happens to your earnest money while you wait.

What this article answers

• What does accepting backup offers mean?
• How do you write a backup offer in Texas?
• Does a backup offer require earnest money?
• Are backup offers binding?
• How long do backup offers last?
• Are backup offers worth it?

The short answer

• You deliver the earnest money and the option fee to the title company within 3 days after you and the seller both sign the backup contract.
• If the first contract is still in place on the date you and the seller write in the backup contract, the title company refunds your earnest money and the seller keeps the option fee.

What does accepting backup offers mean?

It means the house already has a signed contract with a first buyer, and the seller is willing to sign a second contract, on hold, with another buyer.

If the first buyer and the seller do not make it to closing and the first contract is canceled, your backup contract, which was in second position, moves into first position and becomes the main contract, keeping the house from going back on the market.

If the first buyer and the seller change something in their contract, for example the closing date, the first contract is not canceled, and your backup contract keeps waiting.

How do you write a backup offer in Texas?

Your agent writes it with the same purchase contract used for any house, plus an addendum, a document added to the contract that turns it into a backup offer. Without that addendum, the seller could end up obligated to sell the same house to two buyers. Because this contract has details that can be confusing, it helps to have a professional you feel comfortable with, who can explain the details to you.

Two dates matter in a backup contract. The first is the day you and the seller finish signing it, and from that day you have 3 days to deliver the earnest money and the option fee to the title company. The second is the day the first contract is canceled and yours becomes the main contract, and the rest of the deadlines in your purchase are counted from that day.

That is why the phrase “time is of the essence,” which means you and the seller have to meet each deadline on its exact date, is doubly important in a backup contract, because those deadlines do not start on the same day as in a regular contract.

Does a backup offer require earnest money?

Yes, like any purchase contract, it requires earnest money and, if you want an option period, the option fee.

You deliver both payments to the title company within 3 days after you and the seller both sign the backup contract, even while the first contract is still in place.

With the option fee, you buy the right to get out of the contract during the option period without giving a reason, whether you use it or not. That is why the seller keeps the option fee if you get out of the contract or if your backup contract ends without becoming the main contract. If you buy the house, the title company credits the option fee toward the price at closing. The option period guide explains that payment.

Are backup offers binding?

Yes, the backup contract binds you and the seller from the moment you both sign it.

Before the seller signs, you can withdraw your offer, just as you can with any other offer.

After you and the seller both sign, the way to get out of the contract without giving a reason is the option period, if you paid the option fee. The option period of a backup contract starts on the day you and the seller both sign it. After that, it stays open while your backup contract waits in second position. When the first contract is canceled and yours becomes the main contract, you still have the option days you and the seller agreed on, counted from that day.

For example, if you and the seller sign the backup contract on December 1 with 7 option days, and on December 15 the first contract is canceled and yours becomes the main contract, you can get out of the contract from December 1 until 5:00 p.m. on December 22. Starting December 15, you have those 7 days for the inspection and anything else you want to check. If, within that time, you tell the seller in writing that you are getting out of the contract, the title company refunds your earnest money.

How long do backup offers last?

A backup offer lasts until the date you and the seller write in the backup contract, and if that date arrives before the first contract is canceled, your backup contract ends and the title company refunds your earnest money.

Some buyers set a date a few days away and others prefer a date after the first contract’s expected closing, so it depends on how long you want to wait.

Real-life story

After competing with four other offers and getting ours chosen as the winning one, my client decided to withdraw the offer out of insecurity. The next day my client called me crying, saying that because of pressure they were going to lose the home of their dreams, that they didn’t know what to do, and asking what we could do to get that dream home back.

We submitted a backup offer, and finally, after ups and downs, we were able to close the transaction, and the happiness on my client’s face on closing day was one of the most beautiful moments I have lived as a real estate professional.

It was a transaction that taught me a lot about persistence, and about the insecurity and pressure a buyer can carry when their voice and vote are not the only ones in a transaction.

Are backup offers worth it?

It depends on where the first contract stands. The financing contingency gives the first buyer a set number of days to back out of the first contract if that buyer does not get the loan. Putting in a backup contract after the financing contingency, when the first contract is 7 days away from closing, in my opinion is not something that I would recommend to my buyers. I can let the seller’s agent know about my client’s interest, just in case. Why pay an option fee for a contract that already has a high chance of closing?

With all these dates, having someone to guide you makes a real difference, and with that guidance, a backup contract can help you get back the home of your dreams that you thought you had already lost. The decision is yours, and you can talk over your specific case with me or with an attorney. The Buy page explains how I work with buyers.

If the house you like is already under contract, you can write to me and we can go over how a backup offer would work for that house, in English or Spanish.

Lliliam Foster is a bilingual REALTOR® with Compass serving Spring, The Woodlands, Conroe, Magnolia, Tomball, Cypress, Humble/Atascocita, North Houston/Aldine and the FM 1960 corridor. Information current as of October 2026.

Lliliam Foster, REALTOR® — Compass. This information is general in nature and does not constitute legal or financial advice. Compass is a real estate brokerage licensed in Texas.