As a homebuyer or seller, you may have come across terms like “active under contract” and “contingent” when browsing online listings. These terms refer to the status of a property in the real estate market, and can impact your decision-making process. So what exactly do they mean?
Active Under Contract
“Active under contract” is a status given to a property that has an accepted offer, but the sale has not yet been finalized. Essentially, the property is still on the market and available for backup offers. This means that if the original sale falls through, another buyer can step in and make an offer.
For buyers, this means that the property is still an option, but they should proceed with caution. It’s important to understand why the previous deal fell through and assess whether you’re willing to take on any potential issues that caused the initial offer to fail.
For sellers, an “active under contract” status can be beneficial because it keeps the property in the market, potentially attracting other interested buyers. However, it’s important to note that the property cannot be shown to new potential buyers during this time.
Contingent
“Contingent” refers to a property that has an accepted offer, but the sale is dependent on certain conditions being met. These conditions are typically outlined in the purchase contract and can vary depending on the buyer’s needs and the property itself.
Some common contingencies include financing, inspection, and appraisal. For example, if a buyer’s offer is contingent on securing a mortgage, the sale cannot proceed until the buyer receives final approval for their loan.
For buyers, a property that is “contingent” can still be worth considering, but it’s important to understand the specific contingencies and their potential impact on the sale. Buyers may also want to consider making a backup offer, in case the initial offer falls through.
For sellers, a contingent offer means that the sale is not yet final, and there is still some uncertainty. However, if the contingencies are reasonable and the buyer is diligent in meeting them, the sale is likely to proceed.
In summary, “active under contract” and “contingent” are both terms used to describe the status of a property that has an accepted offer. The difference lies in whether the sale is dependent on certain conditions being met, or whether the property is still available for backup offers. As a buyer or seller, it’s important to understand these terms and their implications when navigating the real estate market.