As you scroll through the real estate listings, you might spot a few that say the house is “under contract.” But what does “under contract” mean?

In most cases, a property is listed as “under contract” once a buyer has made an offer and the seller has accepted. While that’s a big step, it doesn’t mean the deal is done quite yet.

So if you see a house you love that’s “under contract,” don’t give up quite yet. Here’s how to handle this scenario and maybe even get the house.

What does ‘under contract’ mean?

When a real estate listing is “under contract,” there are still contingencies attached to that offer that must be cleared before closing, says Kelley Ramirez, a real estate agent with Charles Rutenberg Realty in Central and South Florida. These contingencies often include financing, a home inspectionhome appraisal, and sometimes the sale of the buyer’s current home.

Since it’s possible for any of these items to fall through along the way, seller’s agents will sometimes take backup offers. In other words, if you want this home for yourself, that could still happen.

“If a buyer were to find a home that they absolutely love that is listed under contract with contingencies, it definitely wouldn’t hurt to have their agent reach out to the seller’s agent with a backup offer—as long as the buyer understands that this backup offer is only good if the current contract falls through,” Ramirez says.

How good are your odds of a contract falling through? That depends on a number of factors, including the temperature of your local real estate market. The hotter the market, the less likely it is to fall through.

Hal Hovey, a real estate agent with Coldwell Banker Koetje Real Estate in Oak Harbor, WA, says in his market, about 20% of sales that are under contract don’t end up closing.

“In other words, the sales fail to complete, and typically the house comes back available for sale again,” he says.

However, Ramirez cautions buyers not to get their hopes up too high when it comes to putting in offers on properties that are already under contract.

“The majority of the time, the contingencies are cleared without a problem, and the sale goes through,” Ramirez says.

So how long do you have to wait to find out if you have a shot? Well, it could take a while. Hovey says it typically takes 30 to 45 days from the date an offer is accepted until the sales contract closes and the sale is complete.

‘Under contract’ vs. ‘sale pending’: What’s the difference?

Ramirez says while the terms are often used interchangeably, there are differences between a home that’s listed as “under contract” versus “sale pending.” In most cases, “sale pending” means it’s almost a done deal, and you should probably look for another house.

“If a property is listed as ‘sale pending,’ the contingencies have all been removed, and the property is ready to close,” Ramirez says. “At this point, one would assume it will close without issues, and thus making an offer on this type of property would be a moot point.”

It’s also important to note that these terms may vary by state and region. Your real estate agent can better help you understand where a particular home may be in the sale process and what your chances are of buying it. That said, if it’s truly your dream house, don’t give up hope completely, because issues can crop up, even if they’re unlikely, and until that final line is signed, a sale is not a sale.

So, if you see a home listed as “under contract,” you don’t necessarily have to rule it out.

Your chances of getting it aren’t going to be nearly as high as a home with an active “for sale” status, but it can’t hurt to make an offer or at least keep it on your radar until the final sale goes through.


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