When you’ve been searching for a home that ticks all your boxes for months, there’s no better feeling than finally finding it. Unless its status changes to sale pending before you have a chance to make an offer. That means you’ve missed your shot, right?
Not necessarily. While a pending sale is a setback, it doesn’t mean you’re completely out of the running. Here’s what it means when a sale is pending and what you can do to make an offer on a pending property.
Does sale pending mean that the sale is done?
In real estate, no deal is final until the contract is signed, so a pending sale doesn’t mean it’s a done deal, but it does mean that the seller has accepted an offer from a buyer. At this phase, they have committed to sell to that buyer, both ethically and legally, and as long as the contract’s contingencies are met, they will close on the sale.
The rules on legality are not set in stone, but it’s generally bad form for a seller to back out without a very good reason at this phase of the negotiation, and they can face serious legal and monetary penalties if they do. That means you can still put in an offer, but unless it’s high enough to compensate for any damages they might have to pay the current buyer, it won’t get you anywhere because the seller will not be able to seriously consider it.
One exception is if you put in an offer during the attorney review period. Once an offer is accepted, both parties get an attorney review period (usually five business days) so their lawyers can review the contract and make any changes or cancel it outright without penalty. It’s possible that if you make a very tempting offer at this phase, the seller will back out of the offer currently on the table and take yours instead.
Is a pending sale the same as a contingent offer?
These two statuses represent two different parts of the real estate negotiation process. A contingent offer is an offer from the buyer that is only good if certain contingencies, such as repairs on the home or the buyer selling their current home, are met. If the status of a home is “contingent,” that means the seller has accepted a contingent offer. Once the contingencies are met, the status changes to “pending” and the sale proceeds normally.
You can try to get an offer in before the contingent offer solidifies. Contingent offers are more likely to fall through, so with a good offer or one without contingencies, you’ll be the first in line as a backup.
What can stop a pending sale from happening?
Outside of the attorney review period where either side can back out for any reason, there are many things on both sides that can happen to stop a pending sale. If the house does not pass an inspection, the buyer may legally and ethically back out of a pending agreement. If the house is inspected and the seller refuses to take on the responsibility of fixing an appropriate amount of issues on the contingency list, the buyer may also back out.
In some cases, the buyer will not be able to secure the financing from the preapproval. The seller can back out of the agreement if this happens. Investigations may turn up problems like liens and recording errors with the title, a contingency that can shut down the entire negotiation. Make sure you reach out to the seller’s agent so they keep you updated on the sale. They will be able to tell you exactly where the process is and if it’s progressing or stalling.
What options do you have?
Your first course of action on a pending sale is to have your real estate agent reach out to the seller’s agent. They’ll be able to tell you how firm the seller is on the current offer and what might make the seller consider your offer instead. Depending on the situation, the listing agent may invite you to make an offer.
Even though you shouldn’t put in an offer until you’re invited to, you should make your interest known. Depending on the market, the seller’s agent may continue showing the property to buyers until the sale is final in case the deal falls through. If you do put in an offer, don’t go over what you’re comfortable spending, but make it more appealing by offering to cover more closing costs, closing on a shorter timeline (check with your lender about expediting closing), or offering a rent-back agreement.
Another option you have is to write a handwritten letter to the seller telling them about yourself and what you love about their home. In some special situations, this tactic can be enough to sway a seller in your direction.
At this phase, you have nothing to lose and everything to gain, so don’t be afraid to be aggressive. Stay in touch with the seller and the agent. Be polite, but assertive. If the buyer begins to drag their feet, you could be next in line for the property.
