House hunting on the real estate market can be an exciting yet stressful time for home buyers searching for their dream home. But what happens when you come across a house you really like and it’s listed as “contingent”?
What Does Contingent Mean In Real Estate?
First, let’s define what “contingent” means in terms of a home that’s on the market and its availability for purchase.
A contingent house listing means that an offer on a new home has been made and the seller has accepted it, but before the final sale can advance, some criteria needs to be met. These contingencies are clauses in the sales contract which can include matters that deal with appraisal, home inspection and mortgage approval.
Contingent Versus Pending
For a listing to change from contingent to pending, an offer must be accepted by the seller and all criteria and contingencies must be addressed. Unlike a contingent listing, pending deals are not considered active listings. A home will have pending status until all legal work is completed.
Types of Contingent Statuses
Contingent houses can exist under a few different types of statuses that qualify them as “contingent.” The multiple listing service (MLS) is a real estate marketing and advertising company that helps home buyers browse listings online. MLS can use different terminology when describing contingent statuses, so we will define these terms for you.
Contingent — Continue to Show (CCS)
If a home’s status is Contingent Continue to Show, the seller has accepted an offer, but there are multiple contingencies they must address. At this time, the buyer is working to complete these contingencies, but other buyers can continue to visit the listing and submit offers.
Contingent — No Show
Unlike a CCS status, once a seller has accepted an offer with contingencies, they will no longer be showing the house or accepting offers. Once the buyer addresses these contingencies, the status will be moved to pending.
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Contingent — With Kick-Out
A contingent status with kick-out status means that there is a deadline for the buyer to meet their contingencies. During this time, the seller can continue to show the home and accept bids.
Contingent — With No Kick-Out
A no-kick-out contingent status means there is no deadline for the buyer to meet their contingencies. Even if a higher offer is made, the seller cannot accept it.
Short Sale Contingent
A short sale occurs when a seller is willing to accept less than the amount still owed on the real estate property’s mortgage. A short sale contingent status lets other agents know that the home is no longer for sale because an offer has been accepted. However, this does not mean that the sale has been approved.
Probate is common when dealing with an estate after a death. Contingent probate means the lawyer receives a portion of the estate in payment for completing the process.
Can You Make An Offer On a Contingent House?
It’s important to note that you can make an offer on a contingent house. Just remember that the nature of the contingent offer can be more complex than you might think. There is also the possibility that another interested buyer has a chance at getting the contingent house themselves, for example, if the sale falls through with the initial buyer. This is why you might consider having a strong backup offer for some sellers.
The Bottom Line
If you fall in love with a contingent house, you now know more about what criteria you might have to address before the sale can be approved. If you’d like further information about contingent houses or buying a home, reach out to an expert to learn more.
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