If you are selling your home in Massachusetts, you may see a buyer try to purchase your home with a home sale contingency.
In other words, they write into the Real Estate contract that they will not have to proceed with buying your home unless the buyers successfully close on the property they currently own.
Accepting this arrangement 99% of the time is a big gamble and probably a big mistake!
The thought of ever recommending one of my seller clients accept an offer contingent upon selling another property is just downright foolhardy. To be clear, what kind of real estate market we are in makes no difference. It could be a seller’s, buyer’s, or neutral market, but that does little to change the appeal of a home sale contingency.
An offer contingent on another property closing means one thing – YOU LOSE CONTROL OF THE PROCESS, with no guarantees of anything.
Don’t be lulled into considering this arrangement if a buyer woos you with a full-price offer, either. What good does it do you if you never make it to the closing table?
How Does it Work?
When accepting a sale of home contingency, the buyer and seller agree on all the terms. There will be all the standard terms in an offer, such as the following:
- The sale price
- The earnest deposit amount
- Home inspection contingency
- Appraisal contingency
- Financing contingency
- Closing date
The buyer is given a specific amount of time to sell their home. If, despite their diligent efforts, they cannot sell their property, the contract will be terminated or extended at the seller’s discretion. If the sale is terminated, the buyer may or may not get their deposit back, depending on what is negotiated.
The listing status will be changed to contingent in the Multiple Listing Service.
A Home Sale Contingency in Massachusetts is One Big Gamble!
Crucial Things to Consider Before Accepting a House Sale Contingency
As a home seller, here are a few things to consider:
- How do you know if the contingent home is…