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When you’re buying a house, you’ll hear a lot of terms, some that will sound so similar that you get confused. Two common terms that buyers and sellers confuse are pending vs. contingent.
They sound the same, but they have vastly different meanings. It is important to understand the difference, how they work, and what you must know as a buyer or seller.
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Pending vs. Contingent Overview
You’ll come across many types of listings when you look at homes. Most commonly, you’ll see pending sales or contingent sales. They sound similar, but they have many differences.
A pending sale means the sale no longer has contingencies on it. The buyer and seller are just waiting for the paperwork to be processed to close the deal.
A contingent sale means the seller accepted an offer with contingencies and may still accept other offers. They keep the listing active to keep up the interest should the existing offer fall through.
Contingent means the buyer and seller signed a contract. They agreed on a sales price and the terms, but the buyer wanted contingencies to protect the investment. Common contingencies include a home inspection, appraisal, home sale, or financing contingency.
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A pending home is more of a ‘sure thing.’ There is still a chance the sale will fall through, but it’s less than a 5% chance.
Pending means, the buyer and seller agreed on a sales price, and the contingencies were satisfied.
Because nothing is perfect, the sale can still fall through. The buyer would likely lose their earnest deposit if it did, but if you’re looking at the home, keep your eye on it to see if it officially closes.
What Is the Difference Between Contingent and Pending in Real Estate?
Common Contingent Statuses
- Continue to Show (CCS): A continue to show the property is one with a sales contract with one or more contingencies. The seller kept showing the home in case the buyer uses one of the contingencies and backs out of the contract.
- With or Without a Kick-Out Clause: If a contingency has a kick-out clause, it has an expiration date. If the buyer doesn’t use the contingency by the expiration date, they can’t use it anymore. A contingency without a kick-out clause doesn’t have an expiration date.
- No Show: A contingent contract with no show means the seller won’t show the house. Sellers that know the contingency will be met, such as an inspection or title contingency, may use this type of contract.
- Short Sale Contingent: A short sale contingent property is one sold for an amount less than the owner owes. Because short sales take a long time, the home sits active for much longer than normal, but the sellers aren’t showing it.
- Contingent Probate: A contingent probate property is a property sold by the estate due to the owner’s death.
Common Pending Statuses
- Taking Backups: When a sale is taking backups, it means the owner is taking backup offers. If their current offer falls through, they’ll take the next best offer they received in the meantime.
- Pending Short Sale: A pending short sale is contingent but usually goes through. It just takes a long time for the bank to process the paperwork. Pending short sales typically aren’t shown to others.
- More than 4 Months: Once a listing is pending for 4 months, the MLS automatically lists it as ‘more than 4 months.’ It could mean there’s a problem with the sale or that the seller’s agent forgot to change the status to sold.
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Can You Make an Offer on a Contingent Home?
You can make an offer on a contingent home. There’s no guarantee the seller will accept it, though. The seller’s first obligation is to the buyer with a current contract.
If the buyer doesn’t buy the house and exercises one of the contingencies, the seller will look for the next best offer, so it helps to put an offer in ‘just in case.’
Can You Make an Offer on a Pending Home?
It doesn’t often make sense to make an offer on a pending home. Can you make an offer on a pending home?
Sure. But will sellers accept it or do anything about it? Typically, no because pending means the sale is just about to closing.
Pending vs. Contingent Offers FAQs
Does Pending or Contingent Come First?
Contingent comes first because buyers typically ask for contingencies on the offer before they sign the sales contract. Pending comes after you satisfy the contingencies or remove them.
Why Would a House Go from Pending to Contingent?
It’s rare, but sometimes sales fall through even after it gets to pending status. As all parties work to clear the transaction to close, sometimes things go wrong.
An appraisal may come in low, or an issue during financing could make the sale fall through.
What Does Pending Mean on a House?
Pending occurs once everything is worked out and everyone is waiting for the final documents to close on the loan.
There are many parties involved, including the online mortgage lender, title company, appraiser, buyer, and seller.
It takes a lot of work to clear all the conditions and get everyone on the same page, so a house may be pending for a while everything gets worked out.
Bottom Line: Pending vs. Contingent Offers
If you’re shopping for a home, you’ll find pending and contingent homes. Pending homes are almost through the process and ready to close or just about.
Contingent homes have conditions that must be cleared before the sale is pending.
Contingencies protect buyers but also prolong the closing process. If a contingency doesn’t get cleared, the process may not get to pending.
If a home is contingent, sellers may take other offers in the meantime to offset the risk of losing the sale if the original buyer backs out.