The National Association of Realtors (NAR) reports that six million homes are sold in the United States every year. Earlier this year, CNBC reported that home prices rose at a historic rate. In order to be savvy consumers, buyers and sellers must have the tools and information they need to navigate such a dynamic real estate market.
At Plyler, Long & Corigliano, LLP, our real estate law team strives to provide solutions to our clients. We want everyone to have the knowledge that they need to protect their rights and interests. In this blog post, our Monroe real estate attorneys explain the key things you should know about the differences between contingent and pending in a real estate transaction.
Contingent Home Sale: Explained
A contingent home sale will only go through if certain conditions (contingencies) are satisfied. If one or more contingencies fall through, then they can void the real estate purchase agreement. Contingencies come in many different forms. Some of the most common examples include:
- Appraisal Contingency: The buyer may have the right to pull out of the transaction if a professional appraiser values the property at a lower value. A renegotiation of the sales price might occur if the property is undervalued.
- Home Inspection Contingency: It is not uncommon for a home sale to purchase agreement to be contingent upon an inspection. Once again, renegotiation may occur if an issue arises during the inspection.
- Financial Contingency: If the buyer cannot get the money they need to complete the purchase (usually because of a mortgage loan denial), then the deal may fall apart.
- Home Sale Contingency: Some home sales are contingent upon the buyer being able to sell their property to pay for their relocation.
How often do contingencies fall through? It happens far more often than you might initially think. For this reason, a home subject to a contingent sale is often still an “active listing.” Depending on the nature and scope of the contingencies, the deal may fall apart.
Pending Home Sale: Explained
In North Carolina, a home sale that has moved into “pending” status generally means that all initial contingencies have been satisfied. In some cases, sellers will still accept offers on homes that are “pending,” but they will usually only be a ‘back-up’ offer and might not permit the seller to continue showing the property.
While a pending home sale is not a finalized home sale, it is further along in the process than a contingent home sale. Plenty of contingent contracts fall apart, while far fewer pending transactions fall apart.
Speak to Our North Carolina Real Estate Attorney Today
At Plyler, Long & Corigliano, LLP, our Monroe real estate lawyers are diligent, solutions-focused representatives for our clients. If you have questions about contingent or pending real estate, we can help.
Contact us now to schedule a confidential, no-commitment review of your case. With a law office in Monroe, we handle real estate transactions throughout North Carolina, including in Union County, Mecklenburg County, Rowan County, and Cabarrus County.