What Does Pending Mean in Real Estate
The trading process of homes in the contemporary era is way different than what it used to be traditionally. Back then, it was easy to understand when a house was on sale because properties would claim 'SALE' in white letters, usually printed on a red sign board. However, today, upon seeing 'Pending' in front of a house, you usually assume that the house has been sold out even though that is not true.
What Does Pending Mean in Real Estate
Here is the answer to the bewilderment arising within your mind right now. Even though the house says 'Pending', the house is still available for purchase but with certain restrictions. Marking a home as 'pending' indicates that there is a date that has been allowed to close the sale period and that all contingencies of a sales agreement have either been completed or abandoned. There is still a possibility that the owner may be open to offers on the property as a backup plan just in case the former deal doesn't work well for him because factually his property is still not 'sold out'.
On the other hand, the lender and the escrow company involved in between continues drafting documents and arranging for a loan only in the hope that if the seller agrees to consider their offer before the closing date, they should be all set to put it in. This entire pending scenario primarily works on hope, luck and possibilities. There is no assurity of potential buyers who hope to buy the property that they will end up getting the chance even to bid. Buyers shouldn't keep their hopes high with a 'pending' status in the real estate industry, and instead, they should place these hopes right at the bottom of their potential buying properties' list.
There are a lot of fluctuations that are bound to occur during the entire period while the house remains on 'pending'. However, to convince the seller to consider your proposal just in case the original buyer backs out or walks away due to an emergency, you should be prepared and up for placing your proposal ahead. Your real estate agent may be able to guide you better through this process while providing you with a comprehensive understanding about the 'pending' status so that you know better if it is right for you to spend so much time and money waiting to buy the property, or that you're only wasting your time waiting for it.
The Difference between Contingent and Pending
Contingent: When a property is claimed to be 'contingent' it means that the seller accepted the offer made by a buyer; this is a much better option as compared to waiting for a 'pending' property. Contingent deals somehow reflect the 'Right of First Refusal (RFR)', and it is pretty simple to understand. Just as the owner under adds in clauses that restrict the buying process or even annul it, if those are not duly met. In the same way, contingent deals only remain active with a specific buyer, for as long as the included clauses are met. If these clauses are not the contingent deal is automatically sent into a 'pending' state.
Some of the common contingency contracts are as follows:
- Financial Contingency
- Appraisal Contingency
- Inspection Contingency
- Title Contingency
- Active-First Right
- Active-Kick Out
Pending: When a property is claimed to be 'pending', this indicates that the seller has accepted the offer bidden by the buyer and all contingencies have bee either met or removed. Pending deals cannot be deemed active because a home continues to remain in the 'pending state' until legal documentation, fulfilment of clauses outlined in the contract and the tenure for 'pending' has been achieved. Some of the common pending contracts are as follows:
- Pending – Taking Backups
- Pending – Short Sale
- Pending – More than Four Months
Buildium - Create and Manage Pending List freely in Real Estate
Buildium allows you to create and manage a custom 'wait' or 'pending' list where you can align and save a record of all the potential buyers of your properties that are high in demand for buying. Even when your property is under the 'pending' state, Builidum will help you to keep track of buyers showing an interest in your property so that just in case your initial buyer backs out, and you can immediately consider the best alternative. On the other hand, the buyer whose proposal was the first to be accepted, you can also track if he/she has met all your requirements and mentioned clauses and if he is liable to buy your property.Try Buildium for Free >>>
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