Actual Meaning of Contingent

What Does Contingent Mean?

A home's status as "pending" or "conditional" indicates that the owner has accepted a conditional offer from a potential buyer. Contingencies are requirements that must be satisfied by the buyer, seller, or both in order for the transaction to proceed. For instance, a buyer may make an offer on a house, but the offer might be subject to the buyer first selling their present property or subject to the buyer getting financing. Additionally, the buyer will want to confirm that the property is in good condition during their due diligence period. A home that has been listed as contingent might 'fall through' for a number of reasons, though this is not common.

What Does Pending Mean in Real Estate?

Once all conditions have been satisfied (as determined by the buyer and seller) and a contract has been signed, the listing status is changed from active to pending. The sale status changes to "pending" once an offer has been accepted and the closing and paperwork are the only two stages remaining. Contrary to contingent transactions, pending status does not indicate that the sale is still in progress, preventing other potential purchasers from making offers on the property.

Can you put in an offer on a house that is contingent?

The majority of contingent listings let potential purchasers submit competing bids for the property. This is due to the fact that contingent transactions are still considered to be live listings and are subject to termination if the buyer does not comply with the desired conditions. Consider a scenario in which the buyer's ability to sell their present property is a condition of the sale. If the buyer is unable to sell their current house, the seller will probably want to look at alternative offers in such situation.

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The contingent contract will become "pending" if all goes according to plan and the buyer is able to sell their house. The seller, however, runs the risk of being unable to sell their home. Imagine the seller gets a second offer while the house is still pending. In such situation, the seller will get in touch with the first prospective bidder and offer them a set length of time, usually 24 to 48 hours, to remove the contingency.

The highest bidder will have the opportunity to remove the condition and buy the house, even if their current residence hasn't yet sold. If the first bidder is unable to purchase the house until their current home sells, the seller may move on with the second buyer (or is unable to satisfy any other conditions they put in place).

conclusion

If you're relocating to Raleigh, you should make sure you understand the local home-buying procedure because it differs significantly from other locations. If you are a buyer and find a contingent listing you like, talk to your real estate agent about making an offer on the house. There isn't as much time to hesitate about whether or not you want to make an offer. The first potential buyer will be compelled to proceed with buying the house without the stipulations in place if the seller accepts your bid, or they may release the home and let you purchase it.