The best and final offers are exactly as they sound: it is the highest offer that a potential buyer will make for a home. While sellers may ask for best and last offers for many reasons, it is common to see multiple buyers trying to buy the same house. What is a best and final offer?

Let’s look at the best and last offer and when it is appropriate for you.

A single property might receive multiple offers in situations where there is high demand. Instead of negotiating with every buyer individually, the agent for the seller may request the highest and best offer from all parties. Buyers will usually be given a notice of a few days to allow them time to review their options and submit offers by the deadline.

The buyer’s final chance to buy a property is when they make their best offer. They must use all of their homebuying skills to get the best possible chance at being selected. To make their offer standout, they might consider selling above the asking price, or dropping any other barriers to closing such as contingencies.

Consider the following example from both buyer and seller’s perspectives.

Imagine that you are looking for a San Francisco home with your spouse. The perfect property has been found by your real estate agent. The property is listed at a lower price than the market and it was last updated less than 24 hours. Your agent will call you the next day to inform you that this is a multi-offer situation. Agent of the seller has requested that all parties submit their final and best offer within three days.

Your original offer was contingent on the sale of your home. However, to increase your marketability, you have decided to remove this condition. In the hope that your offer will be accepted, you have also discussed this with your agent. Your agent will submit the offer after much discussion. Now, you just need to wait.

Let’s now look at the perspective of the seller. Your property received four offers in 24 hours after it was listed, which is a sign that the market is hot. The real estate agent will suggest that you ask for the best and most definitive offers. By the deadline you should have received all four offers.

You need to take into consideration several factors before you decide on which offer to accept. Because they offer guaranteed funding, all-cash offers are more attractive and may close faster. Offerings that do not require a home inspection, or the sale of another property, are also attractive.

Imagine you have an all-cash deal for less than the list price and a higher offer of a few thousand more. You might accept an all-cash deal if ease is important to you. It’s not as much, but a quick close will allow you to get out of your home quicker and keep more money. If you want to sell your house quickly and make the most money, the offer might be higher.

It is difficult to answer this question, as it all depends on the situation. You may be able to adjust the contingencies or increase your price if you still have some room in your initial offer. Your first offer can be resubmitted as your final and best.

It is possible to walk away from the property without making a final and best offer. You don’t need to participate in a bidding battle if the property isn’t right for you or you have already made your best offer.

These questions will help you decide if submitting the best or final offer is worthwhile.