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Everything To Know About Contingent Offers in Real Estate

If you’re in the market to purchase a home in an area like Waltham, MA you may stumble upon the listing status known as contingent. This listing status can be quite confusing and may cause a bump in the road when trying to decide on homes to view. Therefore, we made this article to help shed some light on contingent offers and what they mean.

 

What Does a Contingent Offer Mean?

A contingent offer is simpler than what most buyers tend to initially think. Contingent offers are when a buyer and seller agree on specific terms and conditions that must be met before moving on with the sales process. If these conditions are not met by the deadline of the contract then the deal is voided and the seller can begin to accept other offers.
 
Contingent offers are made to reduce risk for the buyer of the house. For example, when purchasing a Waltham, MA home you can make an offer contingent on the home inspection to verify there are no mechanical or structural defects with the home. If defects are identified during the home inspection then the buyers can back out of the deal and the contingent status becomes active again

 

Common Contingencies When Selling a Home

Now that you are aware of what a contingent offer is when purchasing a home, let's go over the most common types of contingent offers used. Home inspection contingency allows a buyer to back out of a sale if defects are found in the home.  A mortgage contingency gives the buyer the right to void a sale if they cannot obtain a mortgage.  A title contingency ensures that the home has a clean title and you are properly becoming the new owner. A home sale contingency states that the deal will only go through once the buyer can sell their current house. Whilst all these contingencies mentioned are great for buyers, they can be very risky for sellers so do not be surprised if a seller rejects your contingent offer.

 

Can You Still Make an Offer on a Home with a Contingent Status?

When there is a contingent offer status present on a home listing, this tells you the property has not yet been closed. Buyers can still possibly view and make offers for the property until the contingencies are met. Sellers will still take backup offers from new buyers as a way to minimize the risk on their end if the deal ends up falling through. Even if you have an active contingency offer on a home a good Realtor like Hans Brings would suggest you to still look around at other homes and create other offers. This is to help eliminate even more risk on the buyer's end in case the seller cannot meet the agreed-upon terms or deadlines.

 

Can a Seller Back Out of a Contingent Offer?

When it comes to a contingent offer a seller can request what's known as a kick-out clause. This clause allows sellers to keep gaining other offers that may have fewer contingencies. If the seller finds an offer with less contingency then your current offer may be in jeopardy. The seller will give you a deadline to lower the amount of contingencies in your offer. If the contingencies are not removed then the seller can “kick you out” and accept the better offer with fewer contingencies.

 

Realtor Recommendations for a Contingent Offer

If you’re still confused about how contingent offers work and when to make them then we recommend hiring a notable real estate agent. Hans Brings is our number one recommendation for all things real estate in the Waltham, MA area. Get in contact with Hans Brings today and make your home buying and selling experience easy!

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