The process of purchasing or selling a home involves several complex steps, each filled with its own unique jargon. One term that often leads to confusion is “sale pending.” In real estate, a ‘pending sale’ is more common than you might think, yet its understanding can be shrouded in ambiguity. This blog post aims to clear the clouds and offer an in-depth understanding of what a home sale pending means.

What is a Pending Home Sale?

A pending home sale refers to a property whose seller has accepted an offer from a potential buyer, and all contingencies associated with the agreement have been met. The home is under contract at this point and is now awaiting the final closing process.

However, even though a sale is marked as ‘pending’, it doesn’t always mean it’s a done deal. Numerous things could still happen that might result in the sale not going through. Such uncertainties mean that a pending home sale isn’t as final as it sounds.

Why Does a Home Sale Go into Pending Status?

Once a home buyer and seller have negotiated the price and agreed upon terms, they sign a real estate purchase agreement. This contract outlines the details of the deal and may include several contingencies – conditions that must be met before the sale can be finalized. Common contingencies may include home inspections, mortgage loan approval, appraisal, title search, and more.

When all the contingencies have been addressed, the sale status moves from ‘contingent’ to ‘pending’. In essence, a pending sale status indicates that the transaction is in its final stages, awaiting the completion of the closing process.

What Happens During the Pending Sale Process?

The period that a home is in pending status can range from a few days to a few months, largely depending on the length of the escrow process. The pending sale process involves numerous steps, including:

Title Search: This ensures the seller has a clear title, devoid of liens or other potential legal issues. It is a crucial step, as any issues found could potentially delay or derail the sale.

Home Inspection and Repairs: The buyer, in most cases, would have included a home inspection contingency. If the inspection uncovers significant issues, the buyer might negotiate repairs or price reductions or even cancel the contract.

Appraisal: If the buyer is getting a mortgage, the lender will require an appraisal. If the home’s appraised value is less than the sale price, the lender may deny the loan, requiring the buyer and seller to renegotiate or cancel the sale.

Final Mortgage Approval: The buyer needs to secure their mortgage. If the buyer’s financial situation has changed (e.g., job loss or credit score drop), they may not be approved, causing the sale to fall through.

Can You Make an Offer on a Pending Sale?

While it’s not common, it’s possible to make an offer on a pending sale. However, in most cases, the seller may not be able to accept a new offer unless the current pending sale falls through. Some real estate agents might continue to show the property during the pending phase to attract backup offers in case the sale doesn’t close.

Understanding The Term ‘pending sale’

Understanding the term ‘pending sale’ can make the process of buying or selling a home less daunting. Although a pending home sale signals the home stretch of the transaction, it’s important to remember that the sale is not final until all paperwork is signed and the keys are handed over.

Be patient, work closely with your real estate agent, and stay informed to navigate this phase successfully. After all, a pending sale is just another step in the journey to closing the deal.