How to Buy Your Next Home With a Contingency

There are two types of home sale contingencies that can have a big impact on your home sale and your ability to buy your next home.

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There are two types of home sale contingencies when a seller needs to sell their current home before they can buy the next one.

First, there's the contingency on sale day. In this case, the buyer has either listed or not listed their home yet, but regardless, it's not under contract, so they haven't closed. Under these circumstances, the seller may be apt to accept the offer, but unfortunately for the buyer, the seller can still market the home. If another buyer comes to the table with a better offer, the first buyer will typically have a day or two to either drop their contingency or back out of the deal and get their earnest money back.

The contingency on close is common with move-up buyers.

Then, there's the contingency on close. In this case, the seller will have their home listed and have a contract in place; all they have to do is go to the closing table. It's a much stronger contract. Under those terms, the buyer can still do their due diligence while waiting for their home to close. If the sale doesn't work out, then the contract is terminated. If the deal closes, then the buyer can close on the next home.

Homebuyers need to be aware of a few things with these contingencies as well. First, you need to find out if you can qualify for both homes at once if you want to buy the new one before closing the sale of your current home. This is a common scenario for buyers who are trading up into a newer, nicer, or larger home.

If you have any questions about home sale contingencies or about buying and selling a home in the Chicago market, give us a call or send us an email. We're here to help.