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What is a Home Sale contingency? Can I still See the House?

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Real Estate Agent with Pilkerton Realtors

What is a Home Sale contingency? Can I still See the HouseHome Sale Contingency?

 

When there is a contingency on any property,  it means that there is a legal and binding contract on the property but there remains something that the Buyer still needs to do to complete the sale.  It means that the Buyers and the Sellers have reached an agreement on price and terms, but this last item must also be completed.

Contingencies can be the Home Inspection, Financing, Appraisal or, as in this case, the Buyer must sell their home in order to purchase the house. 

In a Home Sale Contingency, the property can remain on the market with the Buyer having first right of Refusal.  This is negotiated at the time of the offer. The Seller will offer to give the Buyer 24, 48 or 72 hours to either release the house or remove ALL contingencies. Sometimes they also request more earnest monies from the Buyers. Then, if for some reason the Buyers don't close for any reason, they lose all their earnest money.

So the house stays on the market and  another Buyer can come in and write an offer on Home Sale Contingencythe property. The Sellers can negotiate the price and terms and the result is contingent upon the first Buyers releasing the Sellers from their contract.

So to answer your second question, the answer is Yes, you can see the property. And if you like it, we can write an offer on it. Even if we agree on Price and terms, it doesn't mean you will get it. It depends on the First Buyer's ability to remove all their contingencies.

 

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Connie Harveyis a local agent with Pilkerton Realtors, serving home buyers and sellers in Nashville, TN, Brentwood TN, and Franklin TN. Let her help you realize your Real Estate goals. She can be reached at 615-371-2474.


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Michael Setunsky
Woodbridge, VA
Your Commercial Real Estate Link to Northern VA

Connie, sometimes back up offers do work out when their is a contingent offer. Our MLS list properties that are contingent with a kick out clause.

Jan 26, 2011 01:30 AM
Dylan Snyder
Snyder Group/Illustrated Properties - Jupiter, FL
Palm Beach County Real Estate

With more and more contingencies being for short sale approval, my team is showing and writing offers on them often. We are closing many deals where we were considered a bank up offer!

Jan 26, 2011 01:31 AM
Connie Harvey
Pilkerton Realtors - Brentwood, TN
Realtor - Nashville TN Real Estate

Chris - we, as Realtors, just need to get better at explaining.

Tni - Our short sales don't show up any different. The sellers just get so sick of the process that they're happy with whatever they have and don't want the showins.

Tom - obviously it's less complicated to just show the active. Usually there's enough to choose from that you can do that.

Tammie - I don't always understand why they do that, but you're right.

Jan 26, 2011 01:43 AM
Connie Harvey
Pilkerton Realtors - Brentwood, TN
Realtor - Nashville TN Real Estate

Christina - we get a good bit of it especially in the mid to higher priced homes.

Grace - thanks for stopping by!

Karen - first, thanks for the ReBlog. Most Sellers and Listing agents want home sale contingencies to be shown but not the others.

Susan - by marking it pending it eliminates the headache of having to turn down the showings.

Jan 26, 2011 01:47 AM
Connie Harvey
Pilkerton Realtors - Brentwood, TN
Realtor - Nashville TN Real Estate

Irene - I've done it many times myself. As long as they understand the process, it can work!

Michael - I used to sell in Chicago and it would put the kickout time in the MLS. Here it just shows the type of contingency. You have to call to see if they're still showing the house unless they've written something in the remarks.

Dylan - That's especially true on the Short Sales because you never know when Buyer #1 will get sick of waiting for an answer!

Jan 26, 2011 01:55 AM
Margaret Goss
@Properties - Winnetka, IL
Chicago's North Shore & Winnetka Real Estate

Very simple and direct explanation - I will reblog today.  Thank you!

Jan 26, 2011 02:02 AM
Joy Daniels
Joy Daniels Real Estate Group, Ltd. - Harrisburg, PA

Thank you for helping me answer a question that is often asked - great answer!

Jan 26, 2011 02:06 AM
Anthony Daniels
Coldwell Banker - San Francisco, CA
SF Bay Area REO Specialist

 

Good stuff Connie.

Thanks for sharing it.

Jan 26, 2011 02:36 AM
Bob Zorechak - ABR, GRI, e-PRO
Keller Williams Realty Metropolitan - Morristown, NJ
Sells Homes in Morris/Somerset/Hunterdon Cos., NJ

In our local market, listings indicating an offer has been accepted with a Home Sale Contingency is not viewed as a negative or a reason not to continue showing, especially if you have buyers who do NOT have to sell their home in order to make a purchase happen. 

Jan 26, 2011 03:07 AM
Lee & Pamela St. Peter
Berkshire Hathaway HomeServices YSU Realty: (919) 645-2522 - Raleigh, NC
Making Connections to Success in Real Estate

Connie, great answers to a couple very frequently asked questions! At one time here in the Raleigh market a contingency sale was frowned on, but in today's market more and more sellers are accepting them.

Congrats on the feature too!

Jan 26, 2011 04:14 AM
Brent Wells
The LivingWell Team - Prosper, TX
Dallas - Fort Worth

Connie,

Nicely stated. Contingency sales are tricky around here, with the market behaving in its current manner its tought for the buyers to sell thier home in a timely fashion.

-Brent

Jan 26, 2011 05:31 AM
Connie Harvey
Pilkerton Realtors - Brentwood, TN
Realtor - Nashville TN Real Estate

Margaret - Thanks for the ReBlog. I tried to keep it simple.

Joy - glad to be of help. Love the picture! LOL

Thanks Anthony - Just aim to please! :)

Jan 26, 2011 05:45 AM
Connie Harvey
Pilkerton Realtors - Brentwood, TN
Realtor - Nashville TN Real Estate

Bob - it shouldn't be a negative. If anything you know that SOMEONE wants the house and you should want to see it to make sure you're not missing something!

Pam - Thanks. Like I responded to someone, this came from the fact that MY house has a home sale contingency. We haven't had any showings since then but it keeps snowing!

Brent - That's the same here. You have to write into the offer enough time to sell and then to close. It's hard to estimate that for the closing date.

Jan 26, 2011 05:48 AM
Ellie McIntire
Ellicott City Clarksville Howard County Maryland Real Estate - Ellicott City, MD
Luxury service in Central Maryland

In this buyers market it is still a good idea to view a contingent home. Especially if the other buyer can not remove the contingency.

Jan 29, 2011 01:18 PM
Bill Burchard
3B Realty: 951-347-3818, CA - Murrieta, CA
Broker, Realtor, Representing Buyers and Sellers

Good morning, Connie. Great explanation of what a contingent offer is.

Jan 30, 2011 02:49 AM
Connie Harvey
Pilkerton Realtors - Brentwood, TN
Realtor - Nashville TN Real Estate

Ellie - I agree. Usually they do the contingency because they really NEED to sell first. Otherwise they would be able to negotiate a better contract without it.

Bill - Thank you. Working on my teaching posts!

Jan 30, 2011 07:57 AM
Pam Dent
Gayle Harvey Real Estate, Inc. - Charlottesville, VA
REALTOR® - Charlottesville Virginia Homes / Horse

Good post.  Most of the time the first buyers do not have the ability to remove the contingency.  I had buyers get a very nice home in their target neighborhood this summer through just this situation.

Feb 09, 2011 02:31 AM
Connie Harvey
Pilkerton Realtors - Brentwood, TN
Realtor - Nashville TN Real Estate

Pam - I just had this happen on my own house. I got a better offer and the first Buyer did, in fact, remove their contingency. It's suppose to close at the end of the month.

Feb 09, 2011 02:51 AM
Donna Foerster
HomeSmart Realty Group - Parker, CO
Metro Denver Real Estate Assistant

Connie~ I've said it before and I'll say it again...I love blog posts that educate consumers!

Feb 22, 2012 06:03 AM
Dondra Parsons
Southern Premier Living Realty powered by eXp Realty - Pinehurst, NC
Realtor®, ​ABR®,​ MRP®

Great explanation!

Jun 17, 2014 03:04 AM