When you drive down your street and see your neighbor’s house for sale with a sign that says “Under Contract” does that mean you are definitely getting new neighbors soon? The answer is, well sort of. In most cases what this means is that a buyer has submitted an offer and the sellers have agreed to it. While this is a big step, it is really just the first step. Here is some more information on how things play out.
What “Under Contract” Means
When a listing is under contract it means there is an accepted offer but there are still contingencies that need to be met before the transaction is cleared to close. These stipulations will most likely include a home inspection, a home appraisal, buyer financing and in some cases the sale of a buyer’s current home.
Because there are a few things that could potentially not come together it is not uncommon to take backup offers. In other words, if you were personally interested in this home for yourself, there could still be a possibility for you. The majority of the time a deal will go through, but there is a small percentage of deals that do fall apart for any of these reasons. Most deals that are solid will complete within 30 to 45 days from when the offer was accepted to the closing.
Under Contract versus Sale Pending
These two terms are often used interchangeably but there are some differences. In both cases there has been a meeting of the minds with an accepted offer. Under contract most often means there are still contingencies to be met, while sale pending typically means that all of the contingencies have been met and the property is ready to close. While anything can happen, at this point one can usually assume that the home is essentially ready to close so submitting an offer is a moot point.