After looking at houses for weeks, you finally find one that is perfect! Unfortunately, your Realtor checks the status to find that it sold just yesterday. Don't lose all hope - your Realtor may suggest you make a back-up offer so that if the prospective buyer does not go through with the purchase, you will be the next in line. Having a good Realtor could still get you the house of your dreams.
The first rule of being "second in line" is don't get attached to the house and do keep looking. There are things that can and may go wrong with the first contract. For example: the prospective buyers may get a terminal case of "buyer's remorse" and back out during the structural contingency period or their financing may not be approved. They may have another house to sell and a limited amount of time to do it. Of course, they do have a strong legal interest in the house and their purchase may go very smoothly. Remember that the back-up offer you make gives you a chance, however, remote, of getting the house you love.
One last tip on the subject of buying the dream house for those among you who won't work with a Realtor because you prefer searching by yourself: some of the very best houses NEVER have public open houses and sell before Sunday to buyers working with smart Realtors who are on top of the Multiple Listing Service and constantly searching for their customers and clients. Usually, these are the buyers who find their dream house.