Can You Buy a House That Is Pending?

Prospective homebuyers often encounter properties listed with a “pending” status. This designation raises questions about whether such a home is still available. Understanding what “pending” signifies in the real estate market is helpful for anyone navigating the home-buying process. This status indicates a significant stage in a property’s transaction journey.

Understanding “Pending” Status

A property listed as “pending” means a seller has accepted an offer from a buyer, and a legally binding purchase agreement is in place. The home is under contract, but the sale has not yet officially closed. During this period, various conditions and requirements of the contract are fulfilled.

The “pending” status has several variations. “Pending with contingencies” suggests the contract depends on conditions like the buyer securing financing or the home passing an inspection. “Active contingent” also indicates active contingencies, but the seller may still show the property or receive backup offers. “Pending without contingencies” or “pending-release” implies all conditions have been satisfied or waived, and the transaction is closer to completion.

Making an Offer on a Pending Property

While a property is pending, it is still possible to express interest and submit a “backup offer.” This positions a prospective buyer to step in if the initial contract fails to close. A backup offer becomes the primary contract if the original deal terminates.

To pursue a pending property, a buyer should engage their real estate agent to contact the listing agent. This communication aims to inquire about the pending status and whether the seller is open to backup offers. If receptive, the buyer can draft a formal backup offer, including standard purchase terms like price, financing details, and desired closing date. An accepted backup offer is held in waiting, ready to activate if the primary contract falls through.

Common Reasons Pending Sales Fail

Many pending sales are contingent upon certain conditions being met. Failure to satisfy these contingencies is a common reason for contracts to fall through. The financing contingency is a frequent hurdle, occurring if the buyer cannot secure a loan or if loan terms do not align with the contract. This can happen if the buyer’s financial situation changes or if the lender’s underwriting process uncovers issues.

The home inspection contingency is another common reason for a pending sale to fail. A professional inspection may reveal significant structural issues, costly repairs, or safety hazards that the buyer or seller are unwilling to address. The appraisal contingency can also cause a contract to terminate if the home’s appraised value comes in below the agreed-upon purchase price. Lenders typically will not finance more than the appraised value. A sale of buyer’s current home contingency allows the buyer to terminate the contract if their existing property does not sell within a specified timeframe.