BUYING A HOME WITH A CONTINGENCY
There are 2 ways of doing this:
The market is at it’s highest since 2007. Low inventory & low rates have made it hard to find a home.
Having a contingent offer accepted must be strategic
Best Way and My Recommendation: List your home, accept an offer and then make an offer contingent on the closing of your home.
I work with a lot of contingent buyers and I’ve found the ones more likely to have their offer accepted on new listings asked for no closing costs coverage and offer at least $50k over list price with a $50k cash above appraised value contingency. That way, ff the property appraised for less, the buyer agrees to pay the difference. I’ve found that properties that have been on the market longer are more likely to accept a full price contingent offer with no closing cost coverage from the Seller. The best way to not have to overpay for your next home and the stress of when your home will be under contract and what price is to List it first!
Step 1: Find your future home and make an offer contingent on you selling your property. You’re then only out the inspection fee if you’re not able to sell yours timely. The property you made an offer on will be listed online as “contingent”, that means the Seller is still willing to show and look at offers.
Step 2: After your offer is accepted, your home must be listed within 5 days.
That means, house ready, pictures done, flyer made, sign in the ground, contract to list all done, entered online, house ready for showings as a moment’s notice.
Step 3: Sell your home.
A contingent contract doesn’t have a set amount of days for you to be under contract on your home, BUT no listing agent or seller is going to accept more than 30 days. I’ve had Sellers counter of 10 days or 12 days and/or ask for Earnest Money to be forfeited.
Step 4: Now you’re under contract on your home. I notify the property you are purchasing, and the “Contingency” status online turns to “Pending”.
After that, it’s a normal transaction. The contract date on your sale is the Sale date for your future property. It’s common to close the same day if the properties are in the same town or county or title company. You have until 9 pm the night of closing to be out of your home. Some Sellers give themselves 2 days to move but some buyers don’t like that. You should prepare yourself to be out the day of closing to get to your goal…. A new better house for your situation!