Buying a house is easier to do if you already sold your current house, but there are times when people find the perfect house to buy prior to selling theirs. If this happens, there are several ways to handle this issue, and one option is to make an offer with a sale contingency on the house you want to buy. Using a sale contingency can help you protect yourself and avoid losing out on buying the home you find, and there are several things to know about sale contingencies.
The basics of a sale contingency
A sale contingency in real estate is an agreement where the buyer of a house puts in an offer to a seller that states that the buyer must sell a house before going through with the purchase of the seller's house. In other words, the person buying a house already owns a house, and he or she must sell this other house before closing on the house the offer is for.
Why sellers are hesitant to accept these
A person selling a house might not like receiving an offer that is contingent upon the sale of another house as there is no guarantee that the deal will go through. This type of contingency puts the seller of the house on hold for a period of time, and it is risky. The buyer might not be able to find someone to purchase his or her home within the period of time stated on the purchase offer, and this could result in the sale falling through for the seller of the house. This is the main reason sellers do not typically like offers that include sale contingencies.
Factors that sellers consider when they receive sale contingent offers
A seller would be more likely to accept an offer like this if your house was already in the process of closing. In other words, if you already have a buyer for your house but are not yet closed on it, the seller would feel more hopeful in the deal. Secondly, if you allow the seller to continue showing the house and receiving offers on it, the seller might be more apt to accept your offer. With this deal, the seller would have the freedom to find another buyer during the time frame of the contract he or she has with you.
To buy a house, you will need to hire a real estate agent for help, and you can do this by contacting an agency in your community.