You’re out walking the neighborhood when you notice that a nearby house that’s for sale has a new sign—“under contract.”
But what does that actually mean?
It might seem like it’s pretty self-explanatory, but there’s a bit more to it than you might think. Let’s take a deeper dive into the topic.
The Definition of a House is Under Contract
At its most basic, a home that’s under contract is exactly what you’d think—it’s under contract. A property is typically listed that way after a buyer has made the seller an offer that the seller has accepted.
But with that said, the contract isn’t a done deal. In order for the sale to be finalized and the house to move to closing, contingencies must be cleared. Those contingencies often include items like finalizing financing, obtaining a home inspection and home appraisal, and in some cases, selling the buyer’s home.
If you find a house you love that’s listed as under contract, is it off-limits? No, actually. You can reach out to the seller’s agent to provide a backup offer in the case that contingencies fall through.
How likely is that to happen? There’s a decent shot—up to 20% of homes under contract don’t proceed to closing.
What About “Sale Pending”?
You may also see the term “sale pending” on real estate signs and listings. How does that differ from a home that’s under contract?
It basically means that the home sale has moved into the final stage, past the stage of simply being under contract.
When a sale is pending, contingencies have been cleared and the home is ready to move to closing.
When You’re Ready to Purchase a Home
Want to quickly move your house from under contract to sale pending? Since finalizing financial aspects of the sale is a key contingency, save yourself some time and future aggravation by obtaining pre-authorization for a mortgage before even shopping around.
This will allow you to move quickly through the financing piece of the puzzle when the time comes.
If you’re ready to take the plunge into homeownership, let the experts at Journey Home Lending help you find the financing that’s right for you. Call us today to get started!
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