Home Sale Contingent Offers.....Be Careful.....They are Baaaack !

By
Real Estate Agent with EXP Realty 414-525-0563 57026-90 Broker

  We have listed some larger homes recently with four or five bedrooms and those kinds of larger listings may attract Buyers who may have a house to sell to expand their living space.Home for sale with question mark These buyers can be in various stages with their present home:

 

-  Have not yet listed their home for fear of not finding the   next one that suits their needs

-  Have their home on the market as a

   FSBO 

- Have an offer on their home with all contingencies not yet met by their buyer, i.e. the home inspection may be complete but loan commitment not yet met

   How can a Seller exercise some protection if they choose to accept an offer with a home sale contingency ?  In our market the home does not have to change the status to "active with offer" when such an offer is accepted.question mark

  1.  Continue to market the home and when such an offer is accepted, be sure that the time given to the buyer to remove their home sale should a secondary buyer write an offer is short- i.e.  24 hours.
  2. Require that the buyers home be listed with a licensed realtor - Some agents require this to be a full as opposed to limited service broker
  3. Require buyer to furnish a copy of the offer on their home when they get one and be mindful of the deadlines for their contingencies
  4. Some legal Counsel will advise having the buyer lift the home sale contingency when the buyer for their home has loan commitment not upon actual closing which leaves the Seller accepting a contingent sale in a tenuous position.weight lifting

       As markets move more quickly...more people move and knowing the right move at the right time for both buyers and sellers requires the expertise of an experienced real estate agent. If you are in southeastern Wisconsin, call the Hansons and you will get the prompt professional service and proven results you deserve for all things real estate.

 

 

 

Posted by

Sally K. & David L. Hanson, ABR, CDPE, CSS, e-Pro,ILHM, REDS


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Rainmaker
4,997,540
Barbara Todaro
RE/MAX Executive Realty - Franklin, MA
Marketing Agent for The Todaro Team

Good morning, Sally....home sale contingencies are a slippery slope.... our MLS offers a "contingent" status.....

Jul 23, 2014 07:17 PM #1
Rainmaker
3,255,308
Sally K. & David L. Hanson
EXP Realty 414-525-0563 - Brookfield, WI
WI Realtors - Luxury - Divorce

Slippery is the word...but becoming more popular here...wondering if the dreaded bridge loans are far behind ?

Jul 23, 2014 07:28 PM #2
Rainmaker
3,816,406
Dorie Dillard CRS GRI ABR
Coldwell Banker United Realtors® ~ 512.750.6899 - Austin, TX
Serving Buyers & Sellers in NW Austin Real Estate

Good morning Sally,

A move up home is often going to attract buyers who have a home to sell. There is protection for the consumer in our MLS..we have a "contingent" status in our MLS..its initials are AC for "Active Contingent". Agents need to know what that contingency ois so can call the listing agent. If the buyer hasn't got their home on the market it's reasonable to expect there is a good shot at obtaining the home. If the buyer has their home under contract and all continguencies are met and closing is in a week..probably not worth pursuing!

Jul 23, 2014 07:28 PM #3
Rainmaker
3,255,308
Sally K. & David L. Hanson
EXP Realty 414-525-0563 - Brookfield, WI
WI Realtors - Luxury - Divorce

We do not have that option Dorie...if we were to use an "active with offer" status it would discourage anyone from showing the house or writing a secondary offer that did not have a home sale, not in the best interest of our Sellers.

Jul 23, 2014 08:01 PM #4
Rainmaker
2,346,102
Roger D. Mucci
Shaken...with a Twist 216.633.2092 - Euclid, OH
Lets shake things up at your home today!

I'm glad I don't have to worry about this sort of thing, but I can sure see how that would be a slipperty slope.

Jul 23, 2014 08:15 PM #5
Rainer
1,756,848
Conrad Allen
Re/Max Professional Associates - Webster, MA
Webster, Ma, Realtor

Hi Sally.  As the market improves they will become more accepted because their house will sell.

Jul 23, 2014 08:19 PM #6
Rainmaker
2,917,357
James Dray
Fathom Realty - Bentonville, AR
Exceptional Agents, Outstanding Results

Haven't had to do one yet but I know it's coming. 

Jul 23, 2014 08:23 PM #7
Rainmaker
2,704,775
Lisa Von Domek
Lisa Von Domek Team - Dallas, TX
....Experience Isn't Expensive.... It's Priceless!

Hello Sally and David,

Contingenies can be presented and successful, I recently had a triple-play that came together to make all four parties very happy!

Jul 23, 2014 09:52 PM #8
Rainmaker
401,223
John Wiley
Right Move Real Estate Group- EXP Realty - Fort Myers, FL
Lee County, FL, ECO Broker, GRI, SRES,GREEN,PSA

Thanks Sally & David for your great suggestions on dealing with contingencies. They do not have to be deal killers when handled properly.

Make it a great day.

Jul 23, 2014 09:57 PM #9
Rainmaker
3,255,308
Sally K. & David L. Hanson
EXP Realty 414-525-0563 - Brookfield, WI
WI Realtors - Luxury - Divorce

Good for you Lisa....it is part of what adds the word "challenge" to what we do !

Jul 23, 2014 09:58 PM #10
Rainmaker
2,020,510
Patricia Feager, MBA, CRS, GRI,MRP
DFW FINE PROPERTIES - Southlake, TX
Selling Homes Changing Lives

This is a perfect example of why people need to use a local Realtor. Here in Texas contingencies are very common. My advice as a Realtor to someone in Wisconsin would not be wise and vice versa.

Jul 23, 2014 10:07 PM #11
Rainmaker
1,847,090
Jay Markanich
Jay Markanich Real Estate Inspections, LLC - Bristow, VA
Home Inspector - servicing all Northern Virginia

I would think contingencies are intentional to create an out.  To me they would muck up the works.

Jul 23, 2014 10:27 PM #12
Rainmaker
3,255,308
Sally K. & David L. Hanson
EXP Realty 414-525-0563 - Brookfield, WI
WI Realtors - Luxury - Divorce

It is not anyone's favorite to navigate Jay but necessary in this market.

Jul 23, 2014 10:45 PM #13
Ambassador
3,874,232
Kathy Streib
Room Service Home Staging - Delray Beach, FL
Home Stager - Palm Beach County,FL -561-914-6224

Sally & David- I haven't heard that phrase "contingency offer" in a few years.  You've given your sellers , though, ways to protect themselves from this. 

Jul 24, 2014 12:03 PM #14
Rainmaker
2,257,053
Joe Petrowsky
Mortgage Consultant, Right Trac Financial Group, Inc. NMLS # 2709 - Manchester, CT
Your Mortgage Consultant for Life

Good morning Sally. Have been seeing more purchase agreements with contingencies for the sale of another sale. You ask all the right questions to make sure you are not wasting you time, along with your seller.

Jul 24, 2014 08:21 PM #15
Rainmaker
1,229,941
Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi
NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656 - New Lenox, IL
708.921.6331 - 40+ yrs experience

Sally:  OMG ... everything old is new again!  Contingencies used to be commonplace, but do newer agents (or Lenders) even know what they are?  Your tutorial will only grow in importance moving forward, I suspect ...

Gene

 

Jul 25, 2014 09:42 AM #16
Rainmaker
303,859
Liz Lockhart
Riverbend Realty, Cape Girardeau, MO - Cape Girardeau, MO
GRI, Cape Girardeau Real Estate

We have a First Right of Refusal status in our MLS. It, along with Pending Continue to Show, stays in active status. In the contingency scenario, we would use FRR. All agents know that an FRR is easily bumped out of place by a well-qualified offer.

Jul 26, 2014 10:00 AM #17
Rainmaker
3,255,308
Sally K. & David L. Hanson
EXP Realty 414-525-0563 - Brookfield, WI
WI Realtors - Luxury - Divorce

Our MLS does not have the FRR status,  and active with offer is not used when the offer has a home sale contingency....each MLS has their own rules which can be a good thing...or not.

Jul 26, 2014 10:08 AM #18
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Rainmaker
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Sally K. & David L. Hanson

WI Realtors - Luxury - Divorce
For All Things Wisconsin Real Estate...Call the Hansons
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