Think back to the last time you were searching for homes... If you're actively working to find a home, that may have been just a few minutes ago.
Chances are you saw terms while searching that you may or may not know the true meaning of. This can be frustrating, especially if you've found a home that you love that has been marked "under contract."
Similarly, if you're thinking about selling your home, you may be wondering what the different stages of the process are once you've accepted an offer but before you've handed over the keys.
This blog post will peel back the curtain on 3 key real estate terms so that you know exactly what you're looking at while buying or selling.
A home is considered under contract when the buyer submitted an offer to buy the property and the seller has accepted the offer. This means that both parties have committed themselves to proceed with the transaction, and it will proceed once any contingencies are met or waived by either party.
If a property is under contract, there is a chance that the deal can fall through due to unforeseen circumstances. In some cases, you may still be able to still make an offer on a property listed as under contract.
Once your home is under contract, but some contingencies need to be met, your property is considered contingent.
Most real estate sales have the 3 boilerplate contingencies of the 1) General Home Inspection, the 2) Appraisal, and the 3) Loan. But, those are pretty typical, and the property typically falls into the PENDING category if those are the only contingencies of the home sale. Learn more about the 3 typical contingencies in this video.
What are the most common "contingencies" that you'll run into when buyin...
If you see the CONTINGENT status on a home, it probably means that the property is contingent on the BUYER selling THEIR home. Usually, if the seller accepts this type of offer, they'll have some sort of "first right of refusal" clause, meaning that they can continue marketing the property as "contingent" (which is technically an ACTIVE status) and accept back-up offers. Once a back up offer comes in, the seller can then give their contingent buyer the "first right of refusal", and either move forward with the original buyer, or move on to the back up offer.
Less likely in this day and age, a CONTINGENT status can also be seen on a property that is a short sale. The buyer and seller may have come to an agreement, but the sale is contingent on the bank approving the short sale.
Now that the seller and the buyer have agreed to each other's terms and all contingencies have been met, the home is marked as pending and taken off the market. The deal hasn't closed yet, but being in the pending stage is the finish line of the deal.
While there is a chance that a property with the pending status can return to the market due to an inspection, appraisal, or financing issue, the chances are lower at this stage.
It doesn't have to be confusing
If you're thinking about selling your home but are unsure of the process, we can help simplify and answer questions.
We have you covered
Our goal is to make the process of selling your home as easy as possible. We'd love to show you how.