How to Buy a House Contingent on Selling Yours: 4 Paths to Success
As a homeowner, there’s a good chance that your next move will have you straddled with two major decisions at one time: selling your current home and buying a new one.
If you’ve found yourself in this complicated situation, know that you’re not alone: 51% of all buyers owned a previous home, according to a 2024 National Association of Realtors (NAR) report, and 59% said that finding the right property was the most difficult step of the home buying process.
Should you prefer not to use a home equity line of credit (HELOC) or a bridge loan to purchase a new house before selling your current one, your real estate agent might recommend including a home sale contingency in your offer. This means that if you’re unable to sell your current home by a specified date, you have the option of walking away from the contract and retaining your earnest money.
A sales contingency can make it harder to get your offer accepted, but it’s not impossible, especially if you sweeten the deal in other ways. Ahead, we’ll explore how to buy a house contingent on selling yours and glean insights from a top-performing agent who has helped buyers win a house with a home-sale contingency clause.
What is a home sale contingency?
In real estate, a “contingency” refers to certain circumstances that must be met before a home sale can be finalized. For instance, a property might go under contract with a house inspection or financing contingency. This means that if a significant structural issue is found during the inspection or the buyer’s financing falls through, they’ll be able to terminate the contract without penalty.
In the case of a home sale contingency, the buyer will be under no obligation to follow through with the purchase of the new house unless their home sells.
These contingencies are typically good for one or two months, giving buyers a set amount of time to put their current house on the market and find a buyer. If their home fails to sell during this timeframe, the contract can be terminated.
