What Does under Contract Mean in Real Estate Sales
Not necessarily, especially considering this fun fact: real estate agents can use these status terms interchangeably if their Multiple Listing Service (MLS) doesn`t have a tag for the corresponding status. That said, when you come across a house in an MLS, you can`t always take its current status at face value. It is always worth asking your real estate agent to confirm the status of the house with the listing agent. Look at other properties while waiting to see what happens. Many other buyers choose not to raise their hopes and therefore will not participate in backup offers. Remember, the more closing costs or serious money you are willing to pay, the more tempting your offer will be for the seller – because who doesn`t like to save a little money? Once an offer has been accepted by the seller, there is a contract that both the buyer and the seller must sign. After signing, there is a legally binding agreement between the buyer and the seller. Each party will then receive a copy of the contract signed by the other party, either in electronic or paper form. This is called an exchange of contracts and the property is now described as “under contract”. “`Under contract` is more or less a meeting of minds.
Buyers and sellers have agreed to contract terms such as price, closing date, personal property, money earned, tax preparation, and contingencies. “The house is officially” under contract if the buyer and seller have signed a written agreement; The house is officially “under contract”. Therefore, the seller can only legally sell his house to another buyer if the buyer and seller do not meet the conditions set out in the contract. It`s important to note that many buyers (and buyer agents) simply prefer to monitor an offer rather than make a backup offer. But if the buyer really likes the property, they may consider a backup offer. If the seller has a strong safeguard contract, it may be less willing to renegotiate repairs and other terms with the main buyer. This can increase the likelihood that the main contract will be terminated by the main buyer and that the backup buyer will be able to purchase the property. Our website is the only one of the three that uses the most accurate wording for the status of the ad. They all mean the same thing, but the wording can be confusing, especially if you`re from a market where a “conditional sale” is common. If you`re on the heels of a house and it`s under contract, there`s always a chance the deal will fail. This means that you can always submit a backup offer. Under contract: definitely.
Unless there is a clause preventing this in the contract, the seller`s representatives will continue to accept backup offers and even show the house. That`s because the deal can easily fail at this point. The Contract is therefore void. The purchase contract is legally binding. Thus, it prevents the seller from choosing to sell to another buyer. If the house is listed correctly, you are likely to be able to buy a house that is under contract or pending. Remember, just because a home is contingent doesn`t mean it has an offer – just an eventuality that is put up for sale. In general, agents continue to accept inquiries about the property if it is under contract. You can also do inspections of the property as it is not “officially sold”. Listing a property when it is under contract makes it safer for both the agent and seller by having additional interested buyers in case the first contract fails. Once the status in MLS has changed, this data is shared with national websites such as Zillow.com, Realtor.com, and Trulia.com.
It also goes to independent brokerage sites like FreestoneProperties.com. Depending on the website, the terminology (pending, under contract, etc.) may be different, which can lead to confusion among buyers and sellers. “If a buyer were to find a home they absolutely love and that is listed under contract with contingencies, it certainly wouldn`t hurt if their agent turned 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 fails.” Ramirez said. If the buyer does not fulfill his obligations under the purchase contract within the time limit, this transaction will be canceled and the other buyers will have the opportunity to buy the house. .