Home Buying in La Jolla>Question Details

Trulia San D…, Home Buyer in San Diego, CA

Do contingency offers make it more difficult to buy a home?

Asked by Trulia San Diego, San Diego, CA Sun Jan 27, 2013

Help the community by answering this question:

Answers

15
Trudi Geniale’s answer
Hi,
I agree that is a very broad statement. Are you speaking of the contingencies in a normal contract or when a property is contingient on the MLS?
All contracts have contingiencies and you have to think of them as deadlines you must meet within a specified time and then move on getting closer to owning your home. A good negotiator will help you achieve that goal. Inspections and Mortgage Contingencies are the two most difficult. If you have been qualified by a good lender you will know how much you can afford. As to the inspections you have to decide if its worth it to you and how well your Realtor can negotiate for you.

I think you are speaking of Contingent Properties on the MLS. This is something that drives we Realtors crazy and is very frustrating to a buyer who is looking to purchase that home or condo. I get numerous inquiries from buyers who are looking at a specifice property on Trulia, Zillow and others and when I tell them the property is contingient they think they don't have a chance. They don't understand the process of a Short Sale. When a property goes contingient it usually means that the Seller has gotten an offer and is trying to see if the bank will take the offer they have accepted and presented.

In the meantime we as Realtors have to call and see if we can still show it and if the Realtor and Seller are willing to take backup offers. Sometimes they will and sometimes they won't. I always think it is wise to take backups because you don't know what the bank is going to come back at. Usually the offer sent to the bank is too low because the Realtor is doing their best at guessing what the bank will take for the amount thats owed. There are also Realtors who put a lowball price on a property and start a bidding war which is frustrating for everyone. You have to look at it on a case by case basis. If you really want to buy that property its best to use a Realtor and ask them to see if they can get an idea of where you need to be on a back up offer and also pull comparables on the area and complex. If a mortgage is involved the property has to appraise. If someone ahead of you has all cash the appraisal won't matter. This can be a long process but if you want the home push for the backup. I have seen numerous escrows fall thru and my buyer got the property.
I hope this helps and Good Luck!
Trudi Geniale
619-578-1100
Dre#01457852
0 votes Thank Flag Link Tue Feb 5, 2013
BEST ANSWER
In today's market, absolutely! Sellers want the cleanest offer with the best likelihood of closing in a timely manner. The more complicated your offer, the less likely it will be accepted.
0 votes Thank Flag Link Mon Jan 28, 2013
Yes, there are many well qualified buyers without contingencies you will are competing against, however, do not let that discourage you from trying. I recently completed a contingent purchase and it worked out great for everyone!
0 votes Thank Flag Link Fri Feb 14, 2014
When there are multiple offers and property going for more than asking price, anything that can give you, as the buyer, the upper edge, can help. Sellers are looking for the cleanest offers and the best terms.
Nancy Bergman
http://www.sandiegohomesbynancy.com
Email - nbergman1@live.com
0 votes Thank Flag Link Sun Feb 9, 2014
Hello,

First and foremost, thank you for posting a question here at trulia. Yes, offers with contingencies do make it more difficult to buy a property but if both parties can compromise, then buying a home will be worth it. I hope this helps. If I can be of further assistance, please feel free to contact me by phone, email, or text.

Sincerely,

Melchor "Mel" Perez
BRE# 01842907
REALTOR®
714-401-8879
perezmelchor8@gmail.com
0 votes Thank Flag Link Sat Feb 8, 2014
Hello,

First and foremost, thank you for posting a question here at trulia. Yes, offers with contingencies do make it more difficult to buy a property but if both parties can compromise, then buying a home will be worth it. I hope this helps. If I can be of further assistance, please feel free to contact me by phone, email, or text.

Sincerely,

Melchor "Mel" Perez
BRE# 01842907
REALTOR®
714-401-8879
perezmelchor8@gmail.com
0 votes Thank Flag Link Sat Feb 8, 2014
It makes it harder but it can work out. For mortgage help, call or email for a free pre-approval in less than 10 minutes. We lend our own money and are licensed in 49 states.

We can do: FHA, Conventional, USDA, VA, HARP, Interest Only, Home Equity, Fixed, and Variable. Find out which product is right for you by calling Brad at (855) 415-5626.

Brad Neumann
Sr. Loan Officer
Crosscountry Mortgage Inc.
Toll Free: (855) 415-5626 ext. 5734
Email: bneumann@myccmortgage.com
NMLS# 948036
0 votes Thank Flag Link Sat Nov 9, 2013
In this sellers' market, if you have a house to sell first it might be a little more difficult because you are competing against buyers that do not have a house to sell. It depends a lot of what your contingency is.
0 votes Thank Flag Link Mon Nov 4, 2013
Hello Trulia,

I realize this is a general question and it's being asked in order to elicit responses and generate interest. The answer really depends on what you are specifically referring to. As a broad statement (there are always exceptions), you are generally in a much better position the less contingencies you have when buying a home. Having said that, it isn't necessarily the amount of contingencies that you have with the offer, but which ones are there. Obviously, there are those items that lead to more deals falling apart (financing being the #1 reason) than others.

As a rule of thumb, keep your contingencies to a minimum (without compromising your ability to do your due diligence). Also, when you are a buyer, it is always a good idea to view your offer from the eyes of the seller. The cleaner it is, the better position you will be in.

Having said that, I wrote an offer last week on a property that hadn't even come in our local MLS system, all cash, well above list price, 14 day close, and even that did not do the trick.

One final note. There are other items, in addition to keeping the contingencies to a minimum, that will make your offer stand out from the competition. If you have elected to work with a consummate business professional, they should be able to let you know what those are.

Best of luck!

Chad Basinger, REALTOR®, CPA, CFP®
858-997-3704
chad@chadbasinger.com
Web Reference: http://www.chadbasinger.com
0 votes Thank Flag Link Mon Jan 28, 2013
Depends on the contingency you are referring to. The less contingencies, the stronger the offer, but you need to evaluate the risk in removing a contingency and weigh against the benefit.

Thanks!
Sinead McAllister
Broker
McAllister Homes Real Estate
858-205-5215
brokermcallister@gmail.com
http://www.McAllisterHomes.com
0 votes Thank Flag Link Mon Jan 28, 2013
Beware of shortening contingency periods for appraisal, loan approval and inspections. These things take time and problems arise. If the contingency period is too short you run the risk of the seller getting anxious and issuing a notice to perform if something comes up in the inspections, or if the lender runs into a glitch or if a second appraisal is required. The standard times are standard for a reason.
Many failed escrows are due to seller's and buyers getting upset about expectations of performance because of shortened contingency times. Do you really want to make a major purchase in a hurry? While it is true that the supply is low and demand is creating multiple offers, it's best to make your offer the best it can be but allow for adequate time on the contingencies.

Maureen Hanley
0 votes Thank Flag Link Mon Jan 28, 2013
They can in a tight market, when you're competing with other offers. Investors feel much more comfortable waiving loan and appraisal contingencies because they often buy with cash, and they often shorten their inspection contingency period as well. Only do it if it makes sense for your
circumstance.
0 votes Thank Flag Link Mon Jan 28, 2013
It would depend on the contingency. All buyers have the default 17 day contingency for loan and inspection, so if that is the contingency you are referring to then, no...it would not make it more difficult to buy a home. If you are talking about having to sell a home as a contingency to buy another, then yes, that could make it more difficult as sellers do not want to wait or they may worry about something happening to your buyer. I have seen it to where the buyer is already in escrow to sell their home and are very close to closing and their current buyer has removed contingencies and so there would be a very small chance of it not going through, and a seller accepting that contingency. Feel free to contact me if you have more questions.
Shannon Anderson
619-261-1133
0 votes Thank Flag Link Mon Jan 28, 2013
In this market where there is limited inventory and multiple offers it most certainly can make it more challenging to get a contingency offer accepted. What price range and area are you looking in?

David Crowell
RE/MAX Solutions
Realtor
619-888-1688
0 votes Thank Flag Link Mon Jan 28, 2013
Making a fair offer, having the right REALTOR, relationships and having the best terms helps you buy a home.

Hector R. Gastelum
Candidate for California State Senate District 40
& Realty Executives Dillon
REALTOR #01382940
2240 Otay Lakes Rd. #306
Chula Vista, Ca 91915
hectorgastelum@yahoo.com
619-954-2225
125*142*10754
efax 619-270-2516
0 votes Thank Flag Link Sun Jan 27, 2013
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2014 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer