Highest and Best Offer

[Sarah Reynolds]

Hey BiggerPockets,

I'm pretty frustrated right now, and I was hoping to get some feedback from everyone.  Two times now I have lost multiple offer situations in which highest and best was requested.  When I come back after the deal has closed to see who won and by how much I see both times that I lost by only about $1,000.  I also see that the listing agent ended up representing the winning bidder.  It is feeling like my own high bid is simply being used as a marker for the listing agent to tack on a nominal amount and award the property to his own buyer.  Is this a new practice?  I'd never had this happen before, and now it's happened twice in one month.  Do people get the listing agent with all his insider information to represent them and ensure that they are the highest and best?!?!

[Russell Brazil]

You are likely losing out to individuals using escalations clauses.  They include a clause in the contract thats says they will beat the 2nd best offer by $X, in your case $1,000.  Im typically more aggressive than that, I use $5,000 escalation amounts.