When searching the market for a home, you’ll likely run across properties marked as “contingent” or “pending.” What do they mean, and what’s the difference between contingent vs pending? We’re here to help you understand what these terms mean so you can know how to move forward if you’re interested in putting an offer down.
“Contingent” Meaning and Common Contingencies
When a property is marked as contingent, it means the homeowner has accepted an offer from a buyer that comes with contingencies. These are conditions that either the buyer or seller (sometimes both) must meet for the sale to go through. Contingent deals are still active listings because they can “fall through” if the requested conditions are not met.
Contingencies can be based on several factors. Some of the more common ones include:
- Financial: If a buyer can’t get the home loan or mortgage they anticipated, then the seller can opt-out through a financial contingency.
- Inspection: If a home inspection reveals significant problems, the buyer can request the seller to make repairs, provide compensation, or they can opt-out altogether.
- Appraisal: This contingency allows a buyer to back out of the deal if the home appraises for less than the sale price.
- Title: If there is any conflict or doubt in ownership of the property, a title contingency allows the buyer to walk away from the deal.
- First Right: This means if the buyer cannot match additional offers made on the home, the seller can opt-out.
- Kick Out: A “kick out” is when a seller has found a buyer, but they need to sell their current home before they can make an offer. If the buyer cannot sell their current home in time to pay, the seller can opt-out.
“Pending” Meaning and Common Pending Types
A property marked as pending means an offer has been accepted by the seller. If a home has contingencies and they go through, the home sale will move into the pending stage.
There are a few types of pending statuses as well. The more common ones are:
- Taking Backups: This means the seller has accepted an offer on their home but has hit a snag in the final stages. In case the deal falls through, they’re accepting backup offers.
- Short Sale: The accepted offer is a short sale (when you sell your home for less than the balance remaining on your mortgage) and must be approved by additional lenders or banks outside the buyer or seller’s control. This can take a long period of time to process.
- More Than 4 Months: The accepted offer has been pending for more than four months. This can be due to issues with negotiations, delayed construction, longer processing time, or an agent oversight in updating the listing status.
Can You Make an Offer on Contingent or Pending Homes?
You may still be able to make an offer on homes listed as pending or contingent. A great real estate agent will become your most important tool for this. Your real estate agent can get in contact with the seller’s agent and find out if they’re accepting backup offers. If they are, then your agent can help you send in an offer. Even if the seller isn’t entertaining backup offers, your real estate agent can make sure you’re the first to know if there are any issues with the current deal so you can act fast to lock it down.
Contingent vs Pending – We’re Here to Help
We hope this clears up the difference between contingent vs. pending sales! Whether you’d like to make an offer on a contingent or pending home, our agents at Crowe Realty can help cut through the confusion and gain you the best chance to get the home you want the most. We’re happy to help and guide you through the entire process in the Montrose, Colorado area.