Jan 30 2022

What Does for Sale under Contract Mean in Real Estate

When you`re browsing for a new home, you might come across a listing that says “For Sale Under Contract”. So, what does this term mean in real estate?

Simply put, “For Sale Under Contract” means that the seller has accepted an offer from a buyer, but the sale has not yet been finalized. A contract has been signed by both parties, and the property is temporarily off the market until the conditions of the contract are met.

Typically, the buyer will need to complete certain activities before the sale can be completed. For example, they may need to obtain financing or complete a home inspection. The terms of the contract will outline the specifics of what must be done before the sale can close.

The duration of the contract can vary depending on the terms agreed upon by both parties. It could be a few weeks or several months, but during this time the property is considered to be “under contract” and cannot be sold to another buyer.

In some cases, a home inspection or financing may reveal issues that cause the buyer to back out of the contract. This is known as a contingency, and it`s a common part of real estate contracts. Depending on the details of the contract, the seller may be able to keep the earnest money deposit if the buyer decides not to move forward.

If all conditions of the contract are met, the sale will proceed to closing. At this point, the buyer will pay the balance of the purchase price, and the seller will transfer ownership of the property.

So, why use the term “For Sale Under Contract” instead of simply “Sale Pending”? While both terms refer to a property that has an accepted offer, “For Sale Under Contract” emphasizes the fact that the sale is not yet completed and can still fall through due to contingencies.

In summary, “For Sale Under Contract” means that a seller has accepted an offer from a buyer, but the sale has not yet been finalized. The property is temporarily off the market until the conditions of the contract are met. If you`re interested in a property that`s under contract, you may still be able to make a backup offer in case the sale falls through.

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