Contingent vs. Pending: What This Means in Real Estate

Contingent vs. Pending. This term can get confusing, even for seasoned real estate agents. While both contingent and pending contracts look similar, they are slightly different. A contingency is a condition that must be satisfied for the contract to be finalized. It could be anything, such as a buyer getting approved for financing, a property inspection, or a home appraisal. For a contract to be contingent on financing, the buyer must have financing approval before a contract is finalized. For the contract to be pending, the buyer must get approved for financing, but the sale is only finalized once the buyer and the seller have signed the contract, along with all other contingencies, are satisfied.

In real estate, the terms contingent and pending are often used to describe a buyer and a seller’s agreements, respectively. A contingent agreement occurs when a home sale is contingent upon the buyer selling a home, avoiding the possibility that the buyer could be forced to move before buying their new property. A pending offer occurs when a buyer submits an offer to a seller, and the seller accepts it but hasn’t yet accepted it.

When you’re getting ready to sell or buy a home, you need to know the difference between contingent and pending listings. Contingent listings are listings that have not sold. The buyer owes a contingency period, usually during the home inspection period, when the home can’t be closed, and the buyer must either buy or cancel the sale. A pending listing has been sold, but the buyer has not completed the transaction.

Contingent listings feature an expiration date, usually a month or a period of time, where the home can only be sold if the buyer purchases it. A pending listing, however, has no expiration date, meaning that the home can remain on the market if a buyer doesn’t buy the home. Contingent listings are generally for homes where the seller is motivated to sell. In contrast, pending listings often occur when the seller is waiting on a buyer to secure financing or going through a divorce.

Real estate agents aren’t the only ones finding themselves in unfamiliar territory. Homeowners and renters looking to sell their property are also faced with terminology (even if you haven’t been in real estate) that you may not understand. One of the most confusing terms is contingent vs. pending. When you list your home for sale, there are two ways that your property will appear “active” with buyers.

Contingent contracts are contracts of sale, where the buyer and seller agree that the buyer will complete the transaction if certain conditions are met. This is common in contract sales, such as real estate contract sales, and when the buyer fails to meet certain conditions, the seller cannot terminate the contract.

Real estate investors have a lot to think about, which sometimes can be too much. There are many different styles and strategies to get started in real estate investing, and it is hard to know which is best for your circumstances. Some investors generally prefer to start small with low risk and build confidence while others prefer to target bigger investments capable of generating more income. As a real estate investor, you can consider various home financing tips while purchasing a new property.

Real estate contracts can be tricky. Recognizing contingent and pending contracts can help real estate agents and clients avoid problems. A contingent contract requires the buyer to be approved for a mortgage loan before purchasing the property. The buyer’s approval may or may not happen, and if it does, it may happen at any time before the closing. In contrast, a pending contract is one in which the buyer is approved for a loan, but the lender has not yet funded the loan.

If you’re writing a blog about real estate, you need to know the difference between contingent and pending offers. After all, these phrases are rife with legal implications, and the last thing you want to do is say the wrong thing and risk a lawsuit.

When a buyer (such as Crawford Home Buyers, for instance) makes an offer on a home, and the seller accepts, it’s now “pending.” The seller’s agent, working through the buyer’s real estate brokerage, has authorized the listing agent, working through the seller’s real estate brokerage, to accept the buyer’s offer. If the buyer doesn’t complete the financing, fails to produce a clean credit report, or fails other contingencies, the contract could fall through.

A contingent contract is when both parties have to agree on certain things before the deal is finalized whereas a conditional contract is one where the seller and the buyer have to agree on certain things before the deal is finalized.

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