What Does Contingent Mean In Real Estate Sales?
Question Of The Day: What Does Contingent Mean In RealEstate Sales?
In everyday use, contingent means ‘conditional’ or‘subject to chance.’ But what does contingent mean inreal estate sales? In real estate, a contingent sale is one whereinthe seller has accepted an offer, but with contingencies orconditions.
These must be met before the sale goes through. The real estateterm contingent means that the listing is still active. Once theseller has accepted the offer and the contingencies have been met,the status of the listing becomes ‘pending.’
Examples of contingencies in realestate sales can include passing a home inspection,verifying the buyer’s financing, or completing the sale ofthe buyer’s current residence.
You may notice that there are different sub-types of thecontingent status.
Continue to show means that the offer has been acceptedbut the buyer is still working to address the contingencies. In themeantime, agents can still show the property and other interestedparties can still submit offers.
No show/Without kick-out means the same as above exceptthe property is no longer available for viewing and the seller isnot accepting any more offers.
Release/Kick-out means the buyer must meet the deadlineset for addressing the contingencies. Other buyers can still lookat the property and the seller can look at other bids.
Pending can also mean several things. Taking back-upsmeans the seller is accepting back-up offers. Release/Continueto show means there is a release clause for one of theparties. The seller can still show the home and accept otheroffers.
Are You A Buyer Who Wants To Bid On A Contingent HomeFor Sale?
- Ask your agent to liaise with thelisting agent regarding the contingency period. In cases like this,it makes a whole lot of difference when you have an expertnegotiating on your behalf.
- Make a strong offer. This canmean offering at an above-asking price or waiving contingencieslike the appraisal contingency. This is a provision that letsbuyers back out if the home is appraised for less than the purchaseprice in the contract. If you are doing this, make sure to consultwith your real estate agent to ensure that this is a strategic movefor you.
- Appeal to emotions. Write apersonal offer letter to the seller aka owner that emphasizes whythey should accept your bid.
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