I understand you are anxious to take advantage of this fabulous buyers market. It sounds to me like you have a great agent looking our for your interest...not wanting you to be placed in a bad situation.
A Contingency with a Kickout (CK) I would bring an offer too because the contract is contingent upon the buyer named within the contract finding a buyer for their home. In this market, there is a good chance you would kick them out. A CO is usually not worth the time. With bank owned properties, there is always room for back up contracts as so much can happen. The only negative is that bank owned properties and short sale properties require a lot of patience because the banks are on banking hours and they are non-emotional about the process...it is all about the dollars. Please do not forget that a non-foreclosure can also be a great deal. Focus on your needs and wants to find a house you want to call home then make your offer.
It is so much better to be qualified before you head out on the home search. That way when you do find a home that you feel is it, you know that it is in your budget and you can proceed with making a offer. In my experience on foreclosures the institution requires that proof up front and they will not consider a contingency. Your agent will have a better chance on getting you the best deal. A Contg/KO is when a buyer has put a contract on a property subject to their property else where closing. If another offer comes in then they have 24 or 48 to decide to remove the contg. and make it a firm deal. If they can not, then their contract is terminated and they sellers will work the second offer. A contg with No KO could be from a number of things, example: the Seller having agreed to do something to the property or the buyer applying an additional earnest money payment by a certain date. The examples are endless and your agent should be able to explain this to you so that you really understand it.
The one question I always ask when a agent calls me and says My cleints love your listing at so and so. I think they will be making an offer. I alway reply, Have they been approved and what lender are they working with. If the answer is, oh we have not done that yet. Most of the time I never hear back from them because they were looking out of their price range. Good Luck and I hope you find and secure the home of your dreams.
Due to the large inventory it's usually not worth making offers on contingent contracts. With CNTG/KO, you might have a chance to bump the other buyer, but you're a bit at a disadvantage since the seller already has an "egg in hand" (as opposed to a bird).
As for your agent, I would say they are giving you GREAT advice. With our new Georgia contracts you could be putting yourself in harms way by making offers on properties that you might be able to actually afford. In addition, your approval letter will give you additional leverage and prove that you are a REAL buyer.
Joshua from Gwinnett County