You can still make an offer, even though the property is pending; about 20% of pending sales fail, so it’s worth a shot. Research the market and comparable sales to guarantee your offer's competitive, showing commitment with an earnest money deposit, typically 1-3%. Your agent will help draft the offer, including contingencies. The seller may accept your offer as a backup if the initial deal collapses due to financing, inspection issues, or appraisal problems. There's more to learn about improving your chances.
Key Takeaways
- Research the local market and comparable sales to determine a competitive offer price.Submit a written offer including contingencies and pre-approval proof despite the pending status.Include an earnest money deposit (1-3%) to demonstrate your commitment to the purchase.Prepare for quick negotiations, as the seller may be working with deadlines from the initial buyer.Understand the difference between pending and contingent sales; backup offers are more viable on contingent ones.
What Is a Pending Sale?
A pending sale occurs when a seller accepts a buyer's offer, but the deal isn't final yet, as it's working through the closing process, which involves inspections, appraisals, and loan approvals.
You'll find the property marked as "pending," indicating the seller isn't actively seeking new offers. We all know most pending sales (around 80%) do close, but potential hiccups like financing issues can cause delays or even cancellation. Understand the contract, especially its contingencies.
The property's status typically remains pending for 30–60 days, as the buyer and seller work through the contingencies. If a deal falls through, don't lose hope! Knowing the pending status lets you prepare, because you might get a chance to make an offer if the opportunity arises.
Pending Vs Contingent Sales
Understanding the nuances of the real estate market can be challenging. You'll hear "pending sale status" and "contingent sale" tossed around, but what do these real estate terms really mean for you, when maneuvering the real estate market?
A pending sale means the buyer and seller have an offer accepted, and contingencies are usually done; while a contingent sale means certain contingent statuses, like a home inspection or financing, still need clearing. Contingent sales give you a better shot.
- 1. They're more likely to fall through.2. You can submit a backup offer.3. Some even allow further offers!
Around 80% of property sales with pending status close modern home – they're far along!
Contingent sales have a higher chance of failing.
A pending sale averages 30-45 days to closing, whereas contingent sales can drag on.
Is Making an Offer Worth It?
It would be natural to wonder whether making an offer on a property already labeled "pending" is a fool's errand, or a savvy move.
You see a home listed as pending and think your chances of getting it are slim, but hold on! Did you know about 20% of pending sales fall through?
That means even though the sale is pending, it mightn't close.
The Offer Process
Having decided to craft an offer on a property already under contract, you're probably wondering what the process looks like. First, research the local market, and find comparable sales to determine a competitive price that buyers can make.
Then, let your real estate agent help you craft a written offer, including contingencies.
- Provide proof of pre-approval or cash reserves.Specify an earnest money deposit; it's typically 1-3% to show commitment.Be prepared for quick negotiations, as sellers might've tight deadlines.
Once your offer on a pending home is submitted, the seller can choose to wait for the first purchase contract to dissolve or accept your offer as a backup.
If the initial deal falls through, and your offer is accepted, it becomes a binding contract, and the purchase process begins. Moving through this can be tricky, but we're here to help guide you.
Typical Timeframe
You're likely wondering how long pending sales typically take, so let's dive right in, shall we?
Generally, a pending sale hangs around for 30 to 45 days after that offer gets accepted. Got inspection contingencies? Planning on needing financing? That can certainly extend the timeframe!
Home inspections and loan approval processes alone can add to the wait. If you're eyeing a short sale or probate property, brace yourself; these can stretch to 60–90 days, maybe even longer as they await additional approvals.
Now, what if your backup offer on a pending sale actually goes through? Well, that can happen quicker, like within 1–2 weeks if the first deal tanks. Also, if the pending sale is contingent, and there are few or no contingencies, you might watch it close in just 15–20 days!
Common Reasons for Failure
Knowing how long a pending sale might last is one thing, but what're the odds it'll actually make it to the finish line, right? You'll want to be armed with knowledge that can help navigate this confusing stage of real estate.
Several factors contribute to pending sales falling through, and it's good to be informed before you make any decision.
- `1.` Financing Issues: Loan denials happen. Approximately 5% of pending sales fail because of financing issues. `2.` Inspection Contingencies: Major defects like structural damage revealed during inspections? It can cause the sale falling apart! `3.` Appraisal and Title Problems: Low appraisals cause issues (around 2% of the time). Title issues, while less frequent (1-2%), create headaches.
Don't forget the dreaded buyer's remorse! And it's something that impacts pending sales, too.
You'll find that issues stemming from what seems to be small challenges, can often lead to a dramatic change.
Strategic Negotiation
As you're considering swooping in on a property someone else has their eye on, strategic negotiation becomes your secret weapon. First, research local real estate market conditions, ensuring you aren't overpaying and bolstering your position. We acknowledge buyers and sellers have different https://calbizjournal.com/americas-housing-market-is-overheating-what-does-this-mean/ needs.
Did you know a strong backup offer can work? A fifth of pending sales fail! Minimize contingencies when making an offer.
Next, give the seller flexible closing timelines; many pending sale delays involve financing. So, pre-approval and funds proof will help.
It's imperative you chat with the listing agent. What's the seller's motivation? If the seller has accepted an offer, understand their urgency.
Understand you're making an offer on a home purchase even though the property is under contract. You're now maneuvering through the process!
Frequently Asked Questions
Do You Need a Realtor to Make an Offer on a Place?
No, you don't. You'll benefit from realtor benefits, expert negotiation tips, and home inspection advice. We think buyer representation, insight into financing options and contract details assists with offer strategies, a detailed market analysis while being mindful of closing costs and agent selection.
What Is the Hardest Month to Sell a House?
December's toughest; you'll face winter challenges and a holiday slowdown. Colder weather spurs buyer reluctance, causing market stagnation. Fewer showings and holiday distractions abound. Limited inventory, plus tax implications and financing delays, means you're weathering this storm together.
How to Write an Offer to Purchase a House?
In offer preparation, you'll use a purchase agreement. You'll outline financing terms and include contingencies. Earnest money solidifies your commitment! A property inspection is a must. Discuss closing costs, bidding strategy and seller concessions. Get to know the legal requirements.
Conclusion
So, you're thinking of swooping in, huh? It’s risky, I know, but fortune favors the bold! Don't go in blind; understand the terms, and craft an offer that screams, "I'm serious!" You’ve got to be competitive, and remember, patience is key, as deals fall through all the time. Could you be the lucky one? Absolutely! Just be prepared for a no, because let’s face it, sometimes they don’t. Good luck; you've got this!