Knowing the differences between contingent and pending offers can help you spot properties that you might still be able to buy. It can tell you the best way to move forward if you’re interested in bidding on one of them.
What’s the Difference Between Contingent and Pending Offers?
Types of Contingent Offers
You might see a few types of contingent statuses.
Contingent, Continue to Show: The seller has accepted an offer that hinges on one or several contingencies. Other buyers can continue to view the property and submit offers while the buyer is working to settle those contingencies.Contingent, No Show/Without Kick-Out: The seller has accepted an offer with contingencies, but will no longer be showing the home or accepting offers.Contingent, Release/Kick-Out: There’s a deadline by which the buyer must satisfy their contingencies. The seller is still showing the home and accepting additional bids until that time.
Types of Pending Sales
You might see a few kinds of pending statuses, as well.
Pending, Taking Backups: The seller is still taking backup offers for the first offer. Pending, Release/Continue to Show: An offer has been accepted, and contingencies have been met, but there is still some release or “kick-out clause” for one of the parties. The seller will still show and accept offers in this case. Pending, Do Not Show: The sale is essentially a done deal. The seller isn’t showing the home or accepting new bids. Pending, Over Four Months: The home has been in the sales process for four months or longer. The listing should also include a tentative closing date if this is the status.
Many of these phrases overlap, and different real estate groups and multiple listing services (MLS) vary as to the exact phrasing they use. But anything that says “continue to show,” “release,” or “taking backups” usually means that there’s still some hope if you’d like to purchase the home.
How to Make a Backup Offer
Neither pending nor contingent offers are carved in stone. They can and sometimes do fall through. You can take several steps to potentially buy the home if you find a listing that’s in a pending or contingent stage. The seller may be able to accept a better offer if the home is still in an early contingency stage (the buyer is waiting on their financing or for their previous home to sell). You might try to tempt the seller in this case, offering more money, waiving your own contingencies, or by including an offer letter. You can also put in a backup offer in most cases. Here are some steps to take to do that:
Speak to the listing agent (or have your agent do it). Find out how long the contingency period is or when the release date is up. Make a strong offer. Waiving contingencies and making an offer at or above asking price can increase your odds of winning the bid.Write an offer letter. Make a personal, direct appeal to the seller and state your case.
At the very least, you can have your agent contact the listing agent and let them know of your interest if you’re not willing to pay earnest money and option fees on an official backup contract. You’re still leaving the door open if the first deal falls through.
The Bottom Line
Contingent and pending offers are common in real estate, and buyers and sellers should know what they mean and how to deal with them. In both cases, the sale has not been completely finalized and there is still a chance that it could fall through. Whether you’re making an offer or trying to sell your home, be sure to discuss contingencies and pending statuses with your agent.
