what does contingent mean upon buying a house?

Question

a house that i was looking at has been sold the statis is contingent what exatly does that mean

Answer 1

This means before the property can go to settlement/close/escrow. there are other terms and conditions which may or must be fulfilled by the Buyer and/or Seller. The sale is based upon other conditions.

A couple Examples:
The Sale and Settlement: Buyer MUST make application within “D” days to get financing in the amount of $X for “Y” years at “I” interest rate.
If the Buyer doesn’t get the financing, the agreement or the contract is null and void.
The Sale and Settlement: Seller must give good and marketable title OR such title as the Seller can give without abatement of price.

There are many other contingencies: home inspection; various certifications and inspections for different systems; well certification; termite inspection and certification; Use and Occupancy Certificate. Etc.

It all depends on what the language is in the contract or the agreement.

When the sale is for cash, there isn’t any financing to go through.
When its raw ground, usually there isn’t a termite certification.

Thank you for asking your question. I enjoyed taking the time to answer your question. You did a great job - not only for your information, but for every other person interested in reading my answer.

I wish you well!

VTY,
Ronj B.

Answer 2

Okay, there are many contingencies, and this concept appears in many types of contracts, not just real estate.

A contingency is some condition that must be met before the contract is binding on the person who reserves the contingency.

For example, say you are a baseball fan, and you book a room in a hotel in NYC during the World Series, but with the contingency that your favorite team will be playing in the Series. If your team gets beaten in the playoffs, you don't have to take the room or pay for it.

In real estate, buyers put in many contingencies. One is that the contract is only binding if they sell their current home within a certain time. Another is that it is only binding if they can get the financing they expect. Another is that the house has to pass a third-party licensed inspection. The only limit to contingencies is the Buyer's "fear factor." A wise buyer will put in contingencies for anything that might prevent them from being able to Close.

So, if the house is on the market, "sold with contingencies", you can put in an offer, but the Seller is going to accept your offer with the contingency that the other sale has to fall through for your contract to be enforceable.

It's not a bad idea to make such an offer, but don't schedule your movers until the contingency is removed.

Answer 3

By far the most common reason an agent marks a house as contingent in the MLS is that the "buyer" of the home must sell and close on their current home before they can close on this home.

This often means that there is a "bump-able" clause. This means that if you can buy this house without having to sell and close on your current home first then you can place an offer and possibly bump the first contract out of the way. The current contract often has a short period of time to respond and possibly remove their contingency (meaning they now say they can also close on the contract without selling their current home).

A lot of sellers actually refuse to accept offers subject to you selling your present home. They will often only consider offers that are more solid.

Even in a slow market this makes sense if you think about it because this process chases away some other good buyers and makes the seller of the subject house hope and pray that you will do a good job pricing and marketing your current home.

Answer 4

Basically the buyer and seller have agreed to terms but they are waiting for one or more contingencies to clear.

Contingencies are things like: Home Inspection, loan approval, or the sale of another property.

Until all the contingencies are clear the sale is still open for either side to walk away. Once those are clear the buyer loses his/her down payment to walk. I believe there is also something that prevents the seller from taking a better offer too.

Answer 5

Well there are several contengencies that can be put into a Purchase contract but this one could just be a contingency based on Buyer able to obtain a loan or waiting for a house to be sold.

Contingencies are somtimes thought of a loopholes to get out of a contract oo.

Answer 6

that means the buyer of the house might have to secure financing yet in order to close on the house, or might have another house to sell before this deal could close. You could still make an offer on this house, and then the current buyer would have to meet those contingencies or the deal is off for them.

Answer 7

The sale of the home will be sold when the buyer gets a loan. Contingent upon buyer getting the loan...

Answer 8

"Contingent" means that the house purchase the seller is making (where he/she is moving to when they vacate the home you are buying) has to go through before the potential buyer's purchase can be finalized. It's just a little "insurance" against the seller ending up homeless!

Answer 9

It could mean a lot of things but basically it means that the sale going through is dependant on something else happening i.e. the prospective buyer arranging financing, or selling their current property.

Answer 10

There are many contingencies, finncing, selling ones own residence. etc.

It could be thy can take your offer contingent on the first offer falling through.