Pending Sales: A Comprehensive Guide For Buyers & Sellers

Key Takeaways

  • Pending sales are in no way final and could represent a great opportunity for investors, albeit a small one.
  • A pending sale is a property that has gone through every step of the closing process, but has yet to be closed on.
  • Don’t hesitate to make an offer on a pending sale, as there is a small chance the original deal falls through.

A pending sale, at least as it relates to a real estate transaction, represents a property that has gone through every step of the closing process, but has yet to actually be closed on. Agreements have been made, contracts have been signed, contingencies should have been met, and everything required by escrow has been fulfilled; all that remains is the actual close itself. Having said that, pending sales are not final. No deal, in fact, is final until a property has been closed on, which means properties pending sale may be worth looking into.

What Does It Mean When A House Is Pending Sale?

A pending sale is exactly what you’d expect: the sale of a home is awaiting a settlement, or — more likely — in the final stages of escrow. More often than not, pending simply means all the contingencies have been carefully removed and the buyer is “locked” in; all that’s left is to close the deal. In other words, a pending sale is nothing more than a sale that is awaiting closure. The offer has been accepted, a contract has been signed, all contingencies have been accounted for, and all that’s left is to comply with the terms laid out in the escrow account, but I digress. While a pending home sale may mean the transaction is close to complete, it’s anything but. That’s an important distinction to make; pending sales are not final.

Typically, for a sale to be pending it should have passed each and every one of the contingencies laid out in escrow, but there are exceptions. For one reason or another, the contingencies themselves may continue to hold a pending sale hostage. Basically, a sale may remain pending if there are contingencies preventing it from closing.

[ Improve your negotiation skills overnight! Use these 48 PROVEN real estate investing negotiation tricks ]

What does pending mean in real estate?

What Does Sale Pending With Contingency Mean?

In order to understand what a sale pending with contingency means, you must first exhibit at least some familiarity with the concept of a contingency. For those of you less familiar with the idea of a contingency, it is the best way to back out of a deal in the event unforeseen circumstances arise. In other words, contingencies are a safety net for those that know how to use them properly.

In their simplest form, however, contingencies are predetermined criteria that must be met for a sale to proceed. If, for example, a sale is contingent on the home passing inspection, the escrow will note as much. The only way to move forward will be for the home to, well, pass the impending inspection. And therein lies the meaning of a sale pending with contingencies: the only way for things to move forward is for all the criteria of each contingency to be met and signed off on by each party involved in the transaction. It’s not hard to understand how a contingency could delay a closing, or keep a sale pending.

As I already alluded to, a pending sale is nothing more than a home that is in the process of selling. That said, there are a number of reasons the pending process can be extended, not the least of which may be contingencies. You see, it’s entirely possible for the contingencies laid out in escrow to maintain the pending status of a home sale. So to be clear, a sale pending with a contingency is essentially stuck in a holding pattern until the criteria of the contingency have been met.

If A House Is Pending, Can I Make An Offer?

It is absolutely possible to make an offer on a home that is pending sale. As I said before, pending sales are in no way final. While they are essentially on the final stages of the closing process, there is still plenty of room for things to go wrong. Financing can fall through, contingencies can go unmet, and any number of things can impede a home’s sale. That said, there are actually sellers that will welcome additional offers, even while their property is currently pending a sale. It is quite common for listing agents to “label a home with some contingency as ‘active with conditions’ or ‘active continue to show,’ letting other buyers and agents know that the seller will still entertain other offers,” according to Zillow.

In the event a seller is entertaining subsequent offers during a pending sale, there is no reason an interested buyer can’t submit an offer. Just know one thing: the pending sale means the seller is already under contract with another buyer, which means they won’t be able to enter into another contract. All their willingness to entertain additional offers means is that there is potential for an opportunity. “If the first offer falls through, the seller can move straight to the backup,” says Zillow.

When all is said and done, you may submit an offer on a home that is already pending a sale, but you won’t be able to go into contract with the seller while they are already in contract with another buyer. All your offer will do is place you next in line in the event the original deal falls through.

House pending

How Long Does Pending Sale Take?

A sale may be considered pending for as few as a couple of days, all the way up to several weeks. The window for a pending sale isn’t exactly finite, but rather contingent on, well, contingencies. That means there is no universal timeline; only a window. For the most part, however, pending sales will last somewhere in the neighborhood of a week or so.

Can A Pending Sale Fall Through?

Pending sales can and do fall through. For any number of reasons, a pending sale may not be seen to completion. As we have already discussed, contingencies may prevent a sale from transpiring. For example, savvy buyers may remove themselves from a deal in the event the home doesn’t pass an inspection — that is, at least, if there was an inspection contingency included at escrow. What’s more, there are several contingencies that can prevent a sale from transpiring. Every contingency in the final contract represents an opportunity for a pending sale to fall through.

In addition to contingencies, pending sales may fall through because the buyer decided to simply walk away. It is entirely possible for buyers to walk away from a pending sale for any number of reasons; it’s not common but it happens, as the buyer will typically have some skin in the game in the form of an earnest money deposit. In other words, buyers can walk away, but they forfeit their initial deposit.

Again, a pending sale simply represents a home that is in the process of selling; it’s by no means final. There are a number of things that can go wrong on either end of a deal. Having said that, are you interested in pursuing pending sales in the future? Would you consider making an offer on a pending sale, or simply move on? Let us know what you think about pending sales in the comments below.

🔒 Your information is secure and never shared. By subscribing, you agree to receive blog updates and relevant offers by email. You can unsubscribe at any time.
Real Estate Investing Strategies
Real Estate Investing Strategies
Real Estate Investing Strategies
Real Estate Investing Strategies
Real Estate Investing Strategies
Real Estate Investing Strategies