What Is A Reverse Contingency FAQ

By
Real Estate Broker/Owner with HomeRome Realty 410-530-2400 311291
https://activerain.com/droplet/55wT

 

When someone wants to look at properties but they still have a home to sell, we have a discussion that goes something like this.

   What happens if you fall in love with a property? Can you move forward without the proceeds from your current home? 

 

What if I sell and have no place to move? You can feel their fear.

 

Some clients want to see every property even though they have not  considered putting their home on the market. 

 

A reverse contingency may be a a consideration.

 When separate moves are just not possible. My advice  is to list the property, contingent on finding a home of choice.

 

How serious are  they to avoid that second move? 

Ask...

 What if someone comes along and offers a million dollars and their home  is only worth half million. 

Some will say OK, we will pack up, travel for awhile, move to an apartment, move in with parents or go to a hotel for that kind of incentive.

 

Others will not make that move for any amount of money.

This is the perfect time to explain the "reverse contingency." 

 

When an offer is made, a specific clause is in the contract stating  a contingency for a short amount of time (could be weeks) for the seller to find that home of their choice...notice that wording home of choice

 

Once the home is listed, viewing available properties is appropriate so the seller/buyer can become familiar with the available inventory.

When the current home goes under contract, the buyer can write a  offer on the new home contingent on settlement of the present  home. Did you follow that?  There are so many ways to help buyers and sellers.

This is not a simple transaction...there is expertise and coordination required. 

I have done reverse contingencies with success.

Ask questions and find out the buyers and the seller's needs. 

Thinking of buying and selling a home

Call Margaret Rome

 

 Margaret Rome 410-530-2400

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Rainmaker
845,076
Thomas J. Nelson, Realtor, ePRO, CRS, RCS-D
Big Block Realty 858.232.8722 - La Jolla, CA
& Host of Postcards From Success Podcast

We call those "subject to" listings but I like your terminology as ours gets confusing as there are many "subject to" scenarios. Been using this strategy since I got my license because in CA, we've been in markets like that more then not since 1999. Great post, I like the conversation overview.

Jun 05, 2017 09:09 PM #1
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Margaret Rome, Baltimore Maryland
HomeRome Realty 410-530-2400 - Pikesville, MD
Sell Your Home With Margaret Rome

Thomas J. Nelson, Realtor, CRS 

You write the best comments. Not sure if anyone else calls them reverse contingency but I thought it sounded better than I have a home to sell before I can  buy!

Jun 05, 2017 09:13 PM #2
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Praful Thakkar
LAER Realty Partners - Andover, MA
Andover, MA: Andover Luxury Homes For Sale

Margaret Rome, Baltimore Maryland - indeed this is the type of transaction they need to work with real PRO - like you.

Jun 05, 2017 09:36 PM #3
Rainmaker
2,615,989
Laura Cerrano
Feng Shui Manhattan Long Island - Locust Valley, NY
Certified Feng Shui Expert, Speaker & Researcher

They really do want to see every property most of the time and then you have to have chat.

Jun 05, 2017 09:40 PM #4
Rainmaker
2,235,409
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

Over the years I have submitted contingent offers similar to what you mention. However, Sacramento is currently is a very strong sellers market.  There is low inventory and many homes receive multiple offers.  Offers with contingencies like that mentioned would have more difficulty in the current market realm.  

Jun 06, 2017 05:26 AM #5
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Dick Greenberg
New Paradigm Partners LLC - Fort Collins, CO
Northern Colorado Residential Real Estate

Hi Margaret - Mary and I have done a few of those in the past, but in today's hot market, with low inventory and multiple offers, the difficulty in finding a home makes that approach very unattractive to buyers.

Jun 06, 2017 01:48 PM #6
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Margaret Rome, Baltimore Maryland
HomeRome Realty 410-530-2400 - Pikesville, MD
Sell Your Home With Margaret Rome

Dick Greenberg You are right. This is not going to work when every home has multiple offers. It still works occasionally for that one specific buyr and seller. Always appreciate your comments.

Jun 06, 2017 05:16 PM #7
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Anna Banana Kruchten CRB, CRS 602-380-4886
Phoenix Property Shoppe - Phoenix, AZ
Arizona's Top Banana!

Margaret I have written contracts subjec to a reverse contingency - such as yours and it's always worked out just fine. But....it's been many years since I have as our market is fairly fast moving with multiple offers on many homes.

Jun 06, 2017 05:23 PM #8
Rainmaker
519,940
Pat Starnes-Front Gate Realty
Front Gate Real Estate - Brandon, MS
601-991-2900 Office; 601-278-4513 Cell

Interesting. If I understand correctly, the client lists their home for sale with the contingency that they don't HAVE to sell unless/until they find a replacement home. At least you've laid the groundwork and gotten a commitment to know they are serious about moving. Smart!

Jun 07, 2017 06:54 AM #9
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Margaret Rome, Baltimore Maryland

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