What if the perfect home is pending?

It happens a lot — you see a great home, but there is a big ‘Pending’ sign on it, or maybe the home is labeled ‘Contingent.’ Are you out of luck?

Probably. But there is some hope, especially on a contingent property.

A pending transaction means that the home sale is far along. The home is under contract, the offer has been accepted, all contingencies have been met, and the parties are ready.

Your real estate agent could still find out if the seller would still accept offers, but likely the seller and buyer are ready to make the deal.

Contingent sales have more possibilities.

There are all sorts of contingencies.

The main one is financing. If for some reason the buyer can’t get financing, the deal can be off. This can happen if the buyer has been pre-approved for a loan but something happens. Maybe the buyer suddenly loses a job or the lender finds unreported debt during underwriting. In this case, the deal might well fall through and the home will be up for sale again.

A home sale is also contingent on an appraisal. The lender can’t make a loan above fair market value. So if the appraisal comes in low, the deal could fall through. To keep the deal, the buyer would have to make up the difference between the loan (say $125,000) and the appraisal (say, $100,000). The buyer would have to come up with $25,000 to close the gap.

Buyers usually want a sale contingent on inspection. If the inspection reveals problems, the buyer can quit the deal or renegotiate the price.

Some buyers need to sell their own home before buying the new one. This home sale contingency is often rejected by sellers in a tight market.

A kick-out clause benefits the home sellers because, during the contingency period, the sellers can continue to show the house and accept offers. If the sellers receive a better offer, they can ask the original buyer to remove contingencies or lose the home sale.