Should You Add a Contingency Clause? What to Do If an Interested Buyer Still Needs to Sell Their Home
Home sales can be a tricky matter of timing. If you're a buyer, you don't want to sell your home before you have a new home under contract. But if you're a seller, it can be stressful not knowing if a buyer is going to back out because they have their previous home to grapple with. It's a common situation for all that it seems like a looming problem, and most real estate contracts solve it through a contingency clause.
What is a Home Sale Contingency clause?
Many real estate offers and contracts come with a section about the buyer's current home. In this section, or contingency clause, the contract can stipulate a certain date by which the buyer needs to sell their home; if a sale is made by the agreed-upon date, then the contract remains binding. But if the sale isn't made, then the contract isn't terminated.
If you're the current home owner, adding this clause to the contract can help widen your pool of potential buyers. Most people looking for a home can't afford to hold two mortgages as they continue to look for a buyer for their previous home. This clause also lets you continue to market your home to potential buyers in case the contract falls through, and you can widen or narrow the available timeline according to your own needs.
However, marketing your home to other potential buyers while it's listed as 'under contract' can be more difficult. Ultimately, it's up to you how you choose to contract your home with a potential buyer. if you're looking for a set deal with no contingencies, that sort of sale is also possible. Work with your real estate agent and your market to find the best contract for you and your schedule.