Legal Question in Real Estate Law in California

Except for outlawing actual fraud, California law doesn't specify how a seller of real estate may solicit, review and select offers. The practice you describe is unusual but not unheard of. As for eliminating certain bidders and certain lender choices, this method might discourage them and favor cash buyers, but in the examples I've seen, bidders who are confident of their ability to get financing and/or who have obtained good appraisals will go ahead and place offers made conditional upon obtaining the financing.

I agree with Mr. Whipple for the most part. I am not sure why, however, he thinks it is unusual. It depends entirely on the market and the desirability of the property. In pretty much any sale where the sellers' agent expects multiple offers, the agent will set a deadline for submitting offers. The only alternative is to leave all the buyers wondering when their offers will be considered and responded to, or to require the seller to accept the first offer that comes in or reject it and hope that the next one is better. What in the world would make you expect there to be a law that would require that untenable situation for both buyers and sellers? And why would you think there would be a law that prohibits sellers from obtaining all cash or over-asking-price offers? Market value is the price and on terms at which a willing seller and a willing buyer will enter into a sale. If FHA, VHA and loan-contingency buyers cannot offer enough to make the seller take the risk of the sale not closing due to loan contingencies, they are not offering market value. The all-cash buyers are offering the value of no lender risk; the over-asking buyers are offering a higher price for the risk of the sale falling through. Why would the law prohibit the seller from conducting the sale so as to obtain and favor those offers?