"Buying and selling a home at the same time can feel like walking a tightrope, one wrong step and the whole process wobbles. Maybe you've found your dream home in Austin, TX , but need to sell your house in Phoenix, AZ first. That's where a home sale contingency comes in. This clause makes your offer to buy a new home dependent on selling your existing one, giving you financial protection and peace of mind. In this guide, we'll break down exactly how a home sale contingency works, the pros and cons of using one, and practical strategies to make a contingent offer to sell your home as strong as possible."
"Definition: A home sale contingency is a clause in your purchase contract that makes buying a new house dependent on selling your current one. The purchase only moves forward if your existing home sells. Why buyers use it: Many buyers add this clause to avoid carrying two mortgages at once. It also lets you tap the home equity from your current property to use as a down payment on the new home."
A home sale contingency is a contractual clause making a purchase conditional on selling the buyer's current property. Typical contingencies last 30–60 days and allow buyers to list, find a buyer, and close while protecting earnest money if the sale fails. Sellers may add a kick-out clause to keep marketing and accept other offers if the buyer's home does not sell by the deadline. Contingencies protect buyers from carrying two mortgages and allow use of home equity for a down payment. Contingent offers are often weaker in competitive markets because sellers prefer offers without contingencies. Listing early, pricing correctly, and obtaining lender pre-approval improve contingent offers.
Read at Redfin | Real Estate Tips for Home Buying, Selling & More
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