What is a contingent offer: Today’s article I want to share with you what it means to have a contingent offer on the sale of a home. I’m gonna explain to you what it means when a house goes under contract with a contingent offer.
What is a Contingent Offer
A contingent offer is one in which you agreed to buy the home if and only your current one sells.
So you want to sell your house maybe you want a bigger one or a smaller one or in a completely different location for a variety of reasons.
So you’ll need to speak with your lender to find out what kind of loan you can get because maybe you don’t need a loan that’s contingent upon the sale of your home.
Which would give you a little more flexibility in time to go and look for a home that would be a great fit for you.
Downside While Your Current Home Gets Sold
Of course, the downside to that is you may end up paying two mortgages at once while your current home gets sold.
However, paying two mortgages at the same time may be worth it to some people in order to ensure that they get the home that they’re really comfortable with.
Paying Two Mortgages at Once
Now with a contingent offer, you don’t have to worry about paying two mortgages at once. However, there are some downsides to that as well.
Less Time to find the house
You’re going to have less time to find the house that you really want and also two sellers a contingent offer isn’t as attractive as somebody who is ready to close and in our area in the Austin area.
It’s a very strong seller’s market so at the very least if you are planning on giving a contingent offer.
House Already Under Contract
You’ll probably want to have your house already under contract with another buyer and preferably out of the option period. Which is when everybody has their inspections done and might have to come back to the negotiating table to negotiate repairs.
Once we’re done with that then sellers are gonna find your offer stronger more attractive because it’s taken away a lot more risks that not closing.
House on the Market
If you have your house on the market and meanwhile while you’re looking you find a home that you really really want to go ahead and submit that offer.
Hopefully, they’ll accept it even if your house isn’t under contract yet you never know what the seller might accept.
So all in all contingent offers are not uncommon and they can work out great especially for the buyer so they don’t have to pay two mortgages at the same time.
Of course, the downside is that your offer may not be as attractive as other offers to a seller unless that sellers been waiting for a long time to get an offer on the house they may be willing to accept that.