It’s not just about the bricks and bucks when it comes to buying or selling a property. It goes beyond that. So, when viewing a property on the Multiple Listing Service (MLS), one should always be aware of terms and where they are used.
Coming soon, Active, Contingent, Pending, and the most awaited one; Sold/Closed, and such other terms are MLS statuses. These show where your property is in the process of being offered to close. In this blog, you will be clear about the Contingent vs. Pending Sale terms used in MLS.
What is MLS?
Not an organization or software but a gateway for the seller to the biggest exposure of your property. An open invitation to all kinds of buyers on behalf of the sellers to perceive and comprehend the masterpiece your property is.
Multiple Listing Services (MLS) is a database managed by real estate brokers that bring together listings from various properties.
The properties listed and shown on MLS include practically every detail, from the property’s location to images for a more tangible experience.
Moreover, features enable buyers to view the competitive prices and visual experience of the property and sellers to have substantial exposure. Similarly, on the other side, competitive offers magnify the beauty of MLS.
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What do MLS statuses mean?
The various statuses that appear on MLS are:
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Contingent vs. Pending Sale: What does Contingent mean on a house?
In simple terms, contingent in real estate implies that the seller has received an offer and has accepted it. After that, he has still opted to keep their property listing active. This is done by keeping in mind that if in case certain predetermined conditions are not met by the respective buyer.
The seller maintains a balanced attitude in this situation. As he keeps an open mind to hunt for new potential buyers. A seller can keep the door open for the next buyer and move on to them if any contingency (necessary action) is not met by the present one.
» Contingent Meaning: What does contingent mean and how does it affect a home sale?
Types of Contingent Claims
Contingencies include the most critical variables depicted as conditions mentioned and included in the offer. These are in place to protect both the value of earnest money and the property of both parties.
1. Mortgage Contingency Clause or Financing Contingency Clause
A financial contingency clause, also known as a “mortgage contingency clause,” allows the buyer to secure financing, including a mortgage loan for the property. If the loan cannot be obtained, the buyer can walk away and have their earnest money deposit returned with no legal consequences.
2. Appraisal Contingency Clause
An appraisal contingency clause is a condition in a purchase contract that allows homebuyers to back out if the home is appraised for less than the agreed price.
3. Inspection Contingency Clause
Before a real estate contract becomes binding, an inspection contingency clause demands a professional house inspection within a particular time frame. It ensures that the buyer obtains critical information and gives them the option of negotiating repairs, the sale price, or even walking away with their earnest money.
4. Kick-out Contingency Clause
A kick-out provision is frequently included in a house sale contingency, indicating that the buyer is ready to purchase the home in exchange for the ability to sell their current residence. If a seller receives a higher offer, they can “kick out” the initial buyer while still selling their home.
5. Title Contingency Clause
The Title Contingency Clause allows the buyer to back out of the contract if the seller does not have a marketable title. This must be resolved before the buyer closes on the transfer title.
6. Sale Contingency Clause
A home sale contingency allows the buyer a defined period to sell and settle their current home to finance the purchase of the new one. Buyers are protected by this contingency because if an existing home does not sell for the asking price, the buyer can cancel the contract without facing legal ramifications.
7. Close Contingency Clause
A contingency clause is a condition or action that must be met for a real estate contract to be binding. A contingency provision also allows the buyer and seller to cancel their contract under certain situations that may be arranged between them.
Contingent vs. Pending Sale: What does pending mean on a house?
Pending real estate sales, pending real estate sales, sale pending meaning, and so on are some of the terms that include ‘Pending.’ What exactly does this imply? What is its function, and how is it implemented? All buyers and sellers should be aware of these questions to find the right answer.
Pending sale meaning in real estate implies that the seller has received an offer and accepted it. And with no backsies in mind, both parties are moving further to close the deal. Moreover, other processes are in progress regarding the process of payment, financing, and mortgage availability.
When a home is on the market, you can no longer try to outbid another bidder. Unless the sale falls through, which is an unusual but not impossible scenario, your time to acquire the house has likely passed.
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Types of Pending Status
Pending is the following step after contingent. It does not imply that the property has been sold, although it is close. There are some other options and statuses displayed under Pending, depending on the process’s progress.
“‘Pending’ does not mean ‘sold,’” says Joy Triglia, broker, and CEO of Century 21 Universal Luxury in Fort Lauderdale, FL.
1. Pending Taking Backups
In Pending Taking Backups, when a seller is concerned about a deal, they may consider backup offers. If it becomes clear that the existing agreement will not work out, the sellers will begin to consider the backup offers they have received.
2. Pending Short Sale
The term “pending short sale” refers to a property that is currently undergoing the short sale procedure with the mortgage holder. The property’s status as a Pending Short Sale indicates that it is further along in the process and is not receiving backup offers.
3. Pending more than 4 months
For more than four months, the accepted offer has been pending. This could be the result of stalled talks, construction delays, longer-than-normal processing times, or just an agent’s failure to update the listing status.
Difference Between Pending and Contingent
Wouldn’t it be nice to see only “Active” and “Sold” on the MLS Status? However, without bursting this bubble, it is essential to be aware of such statuses to have a comprehensive grasp of the stages of your MLS property listing.
Contingent Vs Pending Sale is one of those MLS Statuses that appears to be quite complicated at first but has a clear and exclusive meaning.
A contingent listing indicates that the seller has accepted an offer but has opted to keep the listing live in case the prospective buyer fails to meet certain contingencies. On the other side, a pending sale means that the provisions on a contingent property were successfully met, and the sale is being processed.
Contingent vs Pending Sale: What is Under Contract?
The term “under contract” refers to the time spent waiting for the property to sell. When a home is under contract, it means the seller has received an offer, but the sale is not completed until the final stage. Both sides are waiting for all the contingencies to be met.
Contingent vs Pending vs Under Contract
| Contingent | Pending | Under Contract |
| The seller has accepted an offer but has asked that the property be kept available for showings and that backup offers be considered. Will end on the expiration date of the listing agreement. | The property is no more open to new offers (Contract with no contingencies, Kick Outs, or Options). The seller has asked for no more showings and will not consider backup offers. Pending postings will not expire and will remain open until they are closed. | When a home is under contract, it means the seller has received an offer, but the sale is not completed until the final stage. Both sides are waiting for all the contingencies to be met. |
Final Word
Once you understand the fundamentals of MLS, you will always feel more assured. It’s also critical to have absolute confidence while listing your property on MLS.
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Frequently Asked Questions
What does active under contract mean?
When a property is listed on a Multiple Listing Service (MLS), its status is set to "Active." It is modified to "Active Under Contract" when an offer is accepted until the deal closes or is canceled.
What does sale pending mean?
In real estate, a pending sale simply indicates the seller has received and accepted an offer on their property. The deal is still in the process, hence "pending" rather than "sold" is used.
What does it mean when a house is pending?
When a home sale is pending, it signifies the sellers have accepted a buyer's offer. When the buyers and sellers sign the documentation that makes the sale official, the sale will be completed. When a home is listed as pending, the chances of other purchasers being able to purchase it are slim.
What is contingent beneficiary?
A contingent beneficiary is someone who benefits from a contingent contract; they profit from a promise to do or refrain from doing something that may or may not happen is fulfilled.
What does active contingent mean?
A property's active contingent status indicates that the seller has accepted a buyer's offer. However, certain predetermined conditions must be met before the home sale can be completed. It is one of the various status updates given to a property listing is active contingent.
What percentage of pending sales fall through?
The percentage of real estate contracts that fail for any reason, including a failed home inspection, is 3.9%, according to Trulia. That means 96.1% of contracts are completed, which is a pretty high chance for any deal.
Can you buy a house if its pending?
It's tough – but not impossible – to buy a home with a pending sale. Most offer letters contain stipulations saying that if a greater offer comes in, the seller cannot cancel the sale. This means you can't simply outbid the present bidder by increasing the price.
What does it mean when a house is contingent?
"Contingent" means "dependent on particular circumstances" in any sense. When a house is advertised as contingent in real estate, it signifies that an offer has been made and accepted, but certain requirements are to be met before the deal can be completed.
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