Contingent vs Pending In Real Estate What's The Difference

What Is The Difference Between Contingent vs Pending in Real Estate

Contingent vs Pending In Real Estate What's The Difference

What Is The Difference Between Contingent vs Pending in Real Estate

Still waiting for an offer on your home? Navigating the real estate market can feel like learning a new language, especially when trying to understand various listing statuses and what they mean for your sale. As Minnesota cash homebuyers with years of experience working directly with sellers, we know how challenging and uncertain this waiting period can be. Whether you’re selling your first home or you’re an experienced property owner, understanding different sale statuses and their implications can help you make informed decisions about accepting future offers and set realistic expectations for your timeline.

Understanding Contingent Status

What Does Contingent Mean in Real Estate?

If you’ve been waiting a while without receiving any offers on your property, understanding common contingencies in advance can help you prepare for successful negotiations. Most buyers will include specific conditions that must be met before finalizing a purchase. These provisions, known as contingencies, are designed to protect both parties by allowing either side to exit the deal if certain requirements aren’t satisfied. Being aware of typical contingencies now can help you evaluate future offers more confidently and know what to expect once you do accept one.

Common contingencies in real estate transactions include appraisal contingency requirements, home inspection findings, and financial contingency clauses. As a seller, you may face delays or challenges when buyers struggle to meet these conditions, which is why it’s often wise to continue entertaining backup offers during this phase.

Types of Contingencies

Inspection Contingency

A home inspection contingency is one of the most common contingencies you’ll encounter when selling your property. This provision gives your buyer the right to have the property professionally inspected within a specified date. As a seller, you should expect the inspection to cover:

  • Structural integrity
  • Electrical systems
  • Plumbing
  • HVAC systems
  • Roof condition
  • Foundation issues
  • Pest infestations

If issues are discovered during the inspection, you may receive one of these requests from the buyer:

  • Complete specific repairs before closing
  • Reduce the sale price to account for needed repairs
  • Cancel the contract and return their earnest money
  • Proceed with the purchase as-is

Title Contingency

Title contingencies affect you as a seller by requiring a clean title without liens or ownership disputes. The title search will examine your property’s history for potential issues that could affect the sale, including:

  • Outstanding legal claims against your property
  • Unpaid property taxes
  • Remaining mortgage balance from your loans
  • Undisclosed heirs
  • Easements or restrictions
  • Fraudulent claims of ownership
  • Clerical errors in courthouse documents

If title issues are found on your property, you’ll need to resolve them before the sale can proceed. This sometimes requires significant legal work and can delay your closing by weeks or months.

Financing Contingency

The financial contingency makes your home sale dependent on your buyer obtaining loan approval with acceptable terms. This contingency can affect you as a seller if your buyer can’t secure a home loan, allowing them to exit the contract while recovering their earnest money. As a seller, you should understand these key aspects:

  • Mortgage contingency deadlines
  • Interest rate requirements that could derail the sale
  • Down payment commitments
  • Acceptable financing types
  • Proof of buyer’s funds
  • Debt-to-income ratio qualifications
  • Credit score requirements

While buyers typically provide a pre-approval letter to show they’re qualified buyers, you should know that final loan approval can still be denied based on factors like changes in their employment, credit score fluctuations, or if your home’s appraised value comes in too low. This is one reason many sellers prefer working with cash buyers or maintaining backup offers during the contingency period.

Contingent Statuses

Continue-to-Show (CTS)

As a seller, you maintain the right to show your property and accept backup offers while waiting for your current buyer to meet outstanding contingencies. Consider choosing this status when:

  • Your buyer needs to sell their current home first
  • Their financing approval seems uncertain
  • Multiple contingencies need to be satisfied
  • The buyer’s timeline is extended
  • There’s strong buyer demand in your market

This arrangement provides you with a safety net if your original buyer can’t meet the contingencies. However, be aware that it can create uncertainty for both your current buyer and potential backup buyers, potentially affecting their motivation to move forward.

Kick-Out Clause

A kick-out clause gives you, as the seller, the power to terminate the current contract if you receive a better offer before all contingencies are met. This clause becomes especially valuable when your buyer has a home sale contingency, meaning they need to sell their current home before purchasing yours. The kick-out clause allows you to:

  • Continue marketing your property
  • Consider better incoming offers
  • Give your original buyer 24-72 hours to remove contingencies
  • Potentially keep the earnest money
  • Move forward with a new buyer if desired

This clause provides important protection for you as a seller, though it may create pressure on your original buyer who risks losing your home to another offer.

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Understanding Pending Status

What Does Pending Mean in Real Estate?

When your property’s status changes from contingent to pending, it means all contingencies have been met and your sale is nearing completion. While contingent deals often fall through, pending sales typically proceed to closing. If you’re looking to avoid the uncertainty of traditional pending periods and are saying “Sell my home fast Minneapolis“, consider working with cash buyers like Mill City Home Buyers who can help you skip these lengthy waiting periods. At this stage, you can expect:

  • Your signed contract is to be in processing
  • Final legal work to be underway
  • Your buyer’s loan documents are being prepared
  • Title work completion on your property
  • Closing date coordination
  • Final walk-through scheduling

While this pending status can last several weeks as these final steps are completed, you can feel more confident about your sale closing than during the contingent phase. Working with a cash buyer can significantly reduce this waiting period and provide more certainty about your closing date.

Should You Work with a Real Estate Agent?

What Working with a Real Estate Agent Looks Like

While agents can help identify properties through the multiple listing service and navigate active listings, their services come with significant costs and potential delays. We buy homes St Paul residents want to sell quickly, offering a simpler alternative to traditional sales methods that can take months and involve:

  • 6% or more in realtor commissions
  • Staging costs
  • Marketing expenses
  • Showing preparations
  • Negotiation delays
  • Financing uncertainties
  • Inspection repairs
  • Appraisal requirements

Don’t let inspection issues, pending delays, or contingencies stand between you and selling your house. At Mill City Home Buyers, we cut through the complications with our straightforward cash offer process. Call us today at (612) 260-5577 or fill out our quick form to get a cash offer today – we can close in as little as 7 days, with no repairs needed and zero realtor commissions.

Managing Your Sale During Contingent and Pending Phases

Despite strong housing market predictions in MN showing continued buyer demand, navigating contingent and pending phases of your home sale requires careful consideration. As a seller, you’ll want to protect your interests during these critical periods. Understanding your options during each phase helps you maintain leverage and avoid costly delays.

When your home moves from active to contingent status, you can still:

  • Consider and accept backup offers
  • Continue showing your property (with a CTS status)
  • Negotiate with multiple interested buyers
  • Exercise kick-out clauses if better offers arrive

However, once your sale moves to pending status, your options become more limited. At this stage, continuing to market your property could jeopardize your current deal and create legal complications. While traditional sales often involve these complex waiting periods, working with cash buyers like Mill City Home Buyers offers a simpler alternative – allowing you to skip contingencies and lengthy pending phases entirely.

Should You Accept Backup Offers During Contingent or Pending Status?

When managing backup offers during contingent vs pending phases of your sale, your ability to accept them varies significantly based on your current status:

Contingent Status:

  • You can actively consider backup offers
  • Backup offers protect you if the current deal falls through
  • You may gain negotiating leverage on the price
  • Unmet contingencies give you flexibility
  • Timing can work to your advantage
  • Multiple backup offers increase your security

Pending Status:

  • Your deal is likely to proceed to closing
  • Accepting new offers risks legal complications
  • Entertaining backup offers may waste buyers’ time
  • Your current buyer has legal priority
  • Contract issues could arise
  • Your focus should be on closing

If you want to avoid the complexities of managing backup offers and contingencies altogether, consider working with experienced cash buyers like Mill City Home Buyers. We provide swift, guaranteed closings without the uncertainty of traditional sales – especially valuable if you’re facing foreclosure or need to sell quickly.

What Working with a Real Estate Agent Looks Like

Frequently Asked Questions About Contingent vs Pending Status

Q: Is it better for my home to be contingent or pending?

As a seller, having your home in pending status is generally more favorable than contingent status. While both contingent vs pending indicate your property is under contract, pending status means most contingencies have been satisfied and your sale is closer to completion. Your pending listing typically has fewer obstacles to closing than when it’s in contingent status.

Q: Should I accept backup offers while my house is contingent?

Yes, accepting backup offers during the contingent phase can be a smart strategy. When you’ve accepted an initial buyer’s offer, maintaining backup offers provides security in case your current sales contract falls through. However, if you want to avoid the uncertainty of contingencies altogether and need to sell your house fast in MN, consider working with a cash buyer like Mill City Home Buyers instead.

Q: Can I legally accept another offer while my house is contingent?

Yes, as a seller, you can often accept backup offers while your property is contingent. Your ability to accept multiple contingent offers depends on your agreement with the original buyer. Many sales contracts include provisions allowing you to continue marketing your property and accept backup offers, providing you with added security during the contingent phase. This is especially common in situations where the original buyer’s ability to close is uncertain.

Q: Why might my contingent offer fall through?

Yes, contingent offers on your property can fall through due to various buyer-related issues including:

  • Failed appraisal contingency requirements
  • Your buyer’s loan application is denied
  • Problems with your buyer’s home sale
  • Issues discovered during your home inspection
  • Title problems with your property

Q: How long will my homestay be in contingent status before going pending?

The timeline from contingent to pending status varies significantly for your sale. While standard transactions typically take 30-45 days, your specific circumstances will determine how long your house remains pending and contingent. Key factors affecting your timeline include your buyer’s financing approval, their home sale contingencies, and any short sale requirements. Working with a cash buyer can significantly reduce this timeline.

Q: Does contingent mean I’ve officially sold my house?

No, having your home in contingent status means you’ve accepted an offer but your buyer must meet specific conditions before the sale can close. Your property is under contract but not yet sold. When comparing contingent vs pending situations, your contingent property is further from closing and has a higher chance of returning to the market.

Q: What are the chances my contingent sale will fall through?

Industry data suggests you have about a 20-25% chance of your contingent offer not reaching closing. As a seller, you should be prepared for common issues like:

  • Your buyer failing to secure financing
  • Problems arising during inspections
  • Low appraisal values
  • Complications with your buyer’s current home sale
  • Title issues with your property

Q: How long should I allow for contingencies when accepting an offer?

When accepting an offer on your home, you’ll need to agree to specific timeframes for each contingency. As a seller, you should understand typical deadlines for:

  • Your buyer’s financing approval (typically 30-45 days)
  • The buyer’s home inspection period (usually 7-14 days)
  • Your home’s appraisal completion (around 21 days)
  • The buyer’s home sale contingencies (often 30-60 days)
  • Short sale approval if applicable (can extend several months)

If these lengthy contingency periods don’t align with your timeline, consider working with a cash buyer who can eliminate these waiting periods and provide a faster, more certain closing date.

Conclusion

Understanding the difference between contingent vs pending status is essential for anyone navigating today’s real estate market. While contingent deals have outstanding contingencies that could prevent completion, pending status typically indicates a more secure transaction nearing completion. How our process works at Mill City Home Buyers eliminates these complications – we provide straightforward cash offers without contingencies or waiting periods.

If you’re looking to get a cash offer today, consider skipping the traditional market’s uncertainty. By working with us, you can avoid:

  • Lengthy waiting periods that can last more than four months
  • Complicated contingency negotiations
  • Risk of deals falling through
  • Multiple showing requirements
  • Expensive realtor commissions
  • Repair costs and inspection issues
  • Financing delays and uncertainty
  • Title problems and legal complications
  • Market fluctuations affecting appraised value
  • Complex contract negotiations

Whether you’re dealing with a pending short sale, need to sell quickly, or want to avoid the hassles of traditional selling, we’re here to help with a straightforward, efficient process that puts cash in your hands faster. Don’t let your property sit in contingent or pending status for months – reach out today for a no-obligation cash offer and experience the simplicity of working with professional home buyers.

Kurt

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