If you’re searching for a new home online, you may see listings labeled “contingent” and/or “pending” in addition to the standard “active” and “sold” listings. If the status is listed as contingent or pending, it means that the house is under contract; that is, the seller has accepted the buyer’s offer to purchase the home, but there are still items to work out before the sale can be finalized.
So what is the difference between contingent vs. pending? And does either status mean that the house is not available?
In this article, you’ll learn the differences between contingent and pending and what each status means for you as a potential homebuyer.
What Does Contingent Mean?
As a general term, contingent means “upon certain conditions being met.” In the context of real estate, it means that the buyer and seller have agreed to the terms of a purchase and sale agreement, but only if certain conditions are met. This is common in real estate because there are several steps between getting a property under contract and closing the deal.
For example, the buyer may need to borrow money to fund the purchase. They cannot complete the deal if they cannot get the financing they need.
Common Contingencies in Real Estate
Here are some common real estate contingencies regularly included in purchase and sale agreements.
Inspection
The inspection contingency allows buyers to have a qualified home inspector review the property to determine the condition it is in[1]. Depending on the verbiage in the contract, the buyer may be able to cancel the purchase if there is a problem with the condition of the home.
Appraisal
The appraisal contingency allows the buyer (or their lender) to have a licensed home appraiser determine the property's fair market value. The buyer may cancel the purchase if the appraiser finds the property worth less than the agreed-upon purchase price. Alternatively, the buyer may choose to reopen negotiations, or they could proceed with the understanding that they might be overpaying. However, if the buyer wishes to proceed and is financing a portion of the purchase price, they may need to make arrangements with the lender to cover the appraisal gap so that the lender is not assuming additional risk by lending on a property that is potentially overpriced.
Financing
The finance contingency gives the buyer time to secure any funding needed to close the deal. It also allows for the possibility that the buyer might not be able to obtain the loan, in which case, they cannot move forward with the deal.
Title
The title contingency allows the buyer to back out of the deal if the ownership of the property is in question. For example, if a divorced seller still had their ex-partner’s name on the title as a co-owner of the property, the title company may need to contact that co-owner to formally approve the sale of the property. Without this approval, the deal may not be able to close.
When a Buyer Is Selling Their Home
If a buyer needs to sell their home to get the funding needed to complete this purchase, they might use a home sale contingency. This could allow them to delay or terminate the purchase agreement if they cannot find a buyer for their home.
Common Contingent Statuses
Contingent listings can have different statuses as follows.
Continue-to-Show (CTS)
A continue-to-show (CTS) listing (also sometimes called a CCS for "contingent - continue showing") is still being actively marketed. This could be a sign that the seller, or their agent, is unsure if the current contract can result in a closed deal, so they are looking for a backup offer in case the existing deal falls through.
No Show
A no show status means that the seller has decided not to seek other offers. This may be because they are confident that they can work through remaining contingencies with the buyers.
Kick-Out Clause
A kick-out clause means that all contingencies must be met by a certain date. If the contingencies are not met, the existing agreement to purchase may be canceled.
What Does Pending Mean?
In the context of contingent vs. pending in real estate, pending means that contingencies have been satisfied, and the deal is expected to close as planned.
However, in general terms, pending means “waiting to be settled.” So you might come across someone using the term pending loosely as a synonym for "under contract," regardless of the status of any contingencies.
Types of Pending Statuses
Here are some of the statuses you might see for pending listings.
Taking Backups
Taking backups means that the sellers may consider other offers.
Short Sale
A short sale is when a homeowner sells their home for less than they owe on the mortgage. This may be done to avoid foreclosure, but it requires the lender’s approval[2]. While waiting for the proper approvals to finalize the deal, the status could be listed as “pending - short sale.”
No Show
No show means that the seller is not taking additional showings or offers. The sellers may be confident that the deal can close as scheduled, so there is no need to continue pursuing buyers.
More Than 4 Months
This means that the transaction has been listed as pending for more than four months. This could be because of delays, or because the real estate broker forgot to update the status to sold when the deal closed.
Contingent vs. Pending FAQs
Does Pending Mean Sold?
Not exactly. Pending means that the seller has a signed contract with a buyer for the sale of the property, but the sale is not yet final.
Can a Seller Back Out of a Contingent Offer?
Possibly. It depends on the terms of the purchase and sale agreement with the buyer. If, for example, the contract has a contingency that allows the seller to cancel the deal if the buyer fails to secure funding by a certain date, the seller could exercise this right to back out of the contingent offer.
Can You Make an Offer On a House That Is Pending or Contingent?
Yes. You can make an offer on a house listed as pending or contingent. Still, because the seller already has a signed contract with another buyer, your offer may not be granted serious consideration. It depends on how the existing deal is progressing.
Is It Worth Looking at a House That Is Contingent?
Maybe. If the current buyer struggles to satisfy one or more contingencies, the seller may entertain backup offers. It is possible for the first deal to fall through and for the backup buyer to end up buying the home. Your real estate agent may have some insight into the current deal to help you decide if it’s worth looking at a specific listing.
The Bottom Line of Contingent vs. Pending
Contingent and pending both mean that an offer has been accepted on the listing, and the listing is under contract. The difference is that contingent listings still need to meet one or more specific conditions before moving forward. With pending deals, conditions have been met, and both parties are planning to move forward to closing. As a buyer, you may be able to make a backup offer on a listing that’s under contract. If the original buyer cannot close the deal, your offer could move forward.
