Contingencies in a real estate contract are normal, but they usually only last about 10 business days, and that accounts for the inspections and the financing contingencies. But, as the seller what other things should you watch out for?
In this market more and more buyers are trying to sell their own house while trying to find another with better payments or closer to town. But, to avoid getting stuck with two mortgage payments they will put an offer in contingent upon them selling their home.
Most of the time, I advise sellers not to accept and offer like this, because buyers tend to not look at homes that have a bumpable buyer, because they are afraid to waste their time and lose it if the other buyer purchases the property. In most cases though, the 1st buyer can't remove their contingency and go forward with the purchase. You see it is a double edge sword. You have one buyer who is afraid the first is going to take it from them and the other who more than likely can't perform if put under the gun.
One option is to give a buyer a time limit on how long they can keep the house off the market, or give them the option to let you keep it as an active listing, but give them the first right of refusal.
I saw one seller last year sign a contingency offer that made it so the seller had the give the buyer 60 days to perform if another offer came in. Now, did that buyer perform? NO! Did the other buyer walk when they found they had to wait 60 days to find out if they were going to get the home? YES! Basically the seller had their home off the market for six months and had nothing to show for it!
Is their a right time to or way to take a contingent offer? Certainly, I've had sellers take a contingent offer, but require the buyer to put a $15,000 non-refundable earnest money deposit down. What this does it makes sure the buyer does what ever they have to do to get the home and if they have the walk, the seller gets some kind of compensation for their time and trouble. You see you have to make it a win-win for both buyer and seller.
For more information on selling your home in the Washington County, Oregon area, please feel free to call or e-mail me anytime.
Todd Clark - broker
Kastings & Associates
Phone: (503)524-9494
Fax: (503)622-8739
Photo courtesy of davdibiase
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I've encountered all kinds of contingencies in residential real estate and very extreme contingencies in commercial real estate that were written by attorneys.
In an increasingly litigious society, a tight real estate market, and an instant gratification society, it seems like contingencies have just become part of the normal way of doing business these days.