Is it better to be contingent or pending?

When it comes to buying or selling a home, there are many terms and processes that can be confusing for both buyers and sellers. One of the most common questions that arises is whether it is better to have a contingent or pending status on a property. In this article, we will explore the differences between these two statuses and discuss which one may be more beneficial for buyers and sellers.

Contingent Status

A contingent status means that a buyer has made an offer on a property, but the sale is contingent upon certain conditions being met. These conditions can vary, but they typically include the buyer’s ability to secure financing, a satisfactory home inspection, or the sale of the buyer’s current home. Essentially, the sale of the property is not yet final and can still fall through if these conditions are not met.

Pending Status

A pending status means that the seller has accepted an offer from a buyer and all contingencies have been met. The sale is now in the final stages and is awaiting the closing process. During this time, the buyer and seller are working towards finalizing the sale, such as completing any necessary paperwork, securing financing, and scheduling a closing date.

Pros and Cons of Contingent Status

One of the main advantages of having a contingent status is that it allows the buyer to back out of the sale if certain conditions are not met. This can provide a sense of security for the buyer, as they are not locked into the purchase until all contingencies are satisfied. However, this can also be a disadvantage for the seller, as they may have to wait longer for the sale to be finalized.

Another disadvantage of a contingent status is that it can make the property less attractive to other potential buyers. When a property is listed as contingent, it signals to other buyers that there is already an offer on the table, and they may be less likely to make an offer themselves. This can limit the seller’s options and potentially lead to a longer time on the market.

Pros and Cons of Pending Status

The main advantage of a pending status is that it signifies that the sale is almost complete. This can be reassuring for both the buyer and seller, as it means that all contingencies have been met and the sale is moving forward. Additionally, a pending status can make the property more attractive to other potential buyers, as it signals that there is a serious offer on the table.

However, a pending status also means that the sale is less flexible. Once a property is in pending status, it is unlikely that the sale will fall through, unless there are major issues during the closing process. This can be a disadvantage for the buyer, as they may not have the option to back out of the sale if unexpected issues arise.

Which Status is Better?

Ultimately, the decision between a contingent or pending status will depend on the specific circumstances of the buyer and seller. For buyers, a contingent status may provide more flexibility and security, while a pending status may be more attractive to sellers. It is important for both parties to carefully consider their options and consult with their real estate agent before making a decision.

In some cases, a hybrid status may also be an option. This is when a property is listed as “active with contingency” or “contingent continue to show.” This means that the seller is still accepting backup offers in case the current offer falls through. This can be a good compromise for both buyers and sellers, as it allows for a backup plan while still signaling to potential buyers that there is already an offer on the table.

In conclusion, there is no clear answer as to whether it is better to have a contingent or pending status on a property. Both have their own advantages and disadvantages, and the best option will depend on the specific needs and preferences of the buyer and seller. It is important for both parties to carefully consider their options and consult with their real estate agent to make the best decision for their situation.