Understanding Pending Home Sales
A home is considered pending when the seller has accepted an offer from a buyer, and the transaction is in the process of being finalized. This typically occurs after the buyer's inspection and due diligence period has ended, and the seller has agreed to the terms of the sale.
During this time, the seller will typically not entertain other offers or show the property to additional potential buyers, as the sale is considered to be in its final stages. The pending status is usually indicated on the multiple listing service (MLS) to inform other real estate agents and potential buyers of the property's status.
Understanding Contingent Home Sales
A home is considered contingent when the seller has accepted an offer from a buyer, but the sale is dependent on certain conditions being met. These conditions can include the buyer's ability to secure financing, the sale of the buyer's current home, or the outcome of a home inspection.
If the conditions are not met, the buyer can back out of the sale, and the seller is free to entertain other offers. Contingent sales are often indicated on the MLS with a notation that the sale is contingent on certain conditions, such as 'contingent on financing' or 'contingent on inspection'.
Key Differences Between Pending and Contingent
The main difference between pending and contingent home sales is the level of certainty that the sale will be completed. A pending sale is generally considered to be more certain, as the buyer has already completed their due diligence and the seller has agreed to the terms of the sale.
In contrast, a contingent sale is less certain, as the buyer may still have conditions that need to be met before the sale can be finalized. This can make it more difficult for the seller to plan for the future, as they may not know for certain whether the sale will be completed.
How Long Do Pending and Contingent Sales Typically Last
The length of time that a home remains pending or contingent can vary depending on the specific circumstances of the sale. In general, pending sales tend to be shorter, as the buyer has already completed their due diligence and the sale is in its final stages.
Contingent sales, on the other hand, can take longer, as the buyer may need to wait for certain conditions to be met before the sale can be finalized. This can include waiting for financing to be approved, or for the sale of the buyer's current home to be completed.
Navigating Pending and Contingent Sales as a Buyer or Seller
As a buyer, it's essential to understand the difference between pending and contingent sales, as this can impact your ability to negotiate the terms of the sale. If a home is pending, it may be more difficult to negotiate, as the seller has already agreed to the terms of the sale.
As a seller, it's crucial to carefully consider the terms of any offer, including any conditions that may be included. This can help you to avoid potential pitfalls and ensure that the sale is completed smoothly and efficiently.
Frequently Asked Questions
What does it mean when a house is pending?
A pending home sale means the seller has accepted an offer, and the transaction is in its final stages.
Can you still make an offer on a contingent home?
Yes, you can still make an offer on a contingent home, but the seller may not consider it until the contingency is resolved.
How long does a home typically stay contingent?
The length of time a home stays contingent varies, but it's typically until the buyer meets the conditions of the sale.
Can a pending home sale fall through?
Yes, a pending home sale can fall through if the buyer fails to meet the terms of the sale or if there are issues with the property.
What is the difference between pending and contingent?
Pending means the sale is in its final stages, while contingent means the sale is dependent on certain conditions being met.
Can you back out of a contingent home sale?
Yes, as a buyer, you can back out of a contingent home sale if the conditions are not met, but you may forfeit your deposit.