Home Selling in 06333>Question Details

Sally Wallson, Other/Just Looking in Groton, CT

How does a HUBBARD CONTRACT work? Is it a positive to accept a hubbard soon after my home is listed?

Asked by Sally Wallson, Groton, CT Thu Mar 22, 2012

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I agree with Sally, from the sellers perspective it can be a negative because buyers may not want to even look at the home because they feel it is "under contract" and therefore not worth the time to view. Also, from the buyers perspective, you can think of it as a right of first refusal at the agreed upon price. If another offer comes in, the buyer with the hubbard must either release the contingency and proceed with the transaction, or withdraw.
0 votes Thank Flag Link Wed May 22, 2013
When you accept a Hubbard clause on your home , you are accepting an offer based on your buyer being able to sell their property in order to buy yours. A Hubbard clause can be a wonderful thing. The goods news is that you will have a buyer for your home. The thing to consider before accepting a Hubbard is what property is your buyer trying to sell? Will it actually sell?
If their property does go under deposit, your sale will be based on how strong of a buyer they have for their home. So the transaction will become a long train of different buyers doing home inspections and getting mortgage commitments. All of this is very possible but just more risky of becoming a train wreck than a closing.
0 votes Thank Flag Link Sat May 18, 2013
Hi Sally

Marianne and Joe's description of what a Hubbard is below is spot on. I'll add that I discourage clients I represent from accepting offers which contain Hubbard clauses since, IMHO, they are really contingencies that are GREAT for Buyers who like your home and want to tie it up, but they are bad for you as a Seller since they essentially take your home off the market. I'm saying that because many agents will not be as enthusiastic about showing homes that are in "Pending-Show" or "Deposit - Show" status since they know a contract is in place already. That's not to say you can't have a successful transaction with that Buyer who's making the offer.

I've had that type of Buyer work fast with their Buyer's Broker and then get their home listed and under contract quickly (30-60 day) and then come back to me with a "clean" offer absent the Hubbard Clause. Your listing agent can keep in touch with that Buyer's agent if you get any new offers and they may come back to you without the Hubbard before their home is sold.

Best of luck with your sale.

Greg Hanner, Broker, REALTOR, e-PRO
http://www.GardenRealty.com
0 votes Thank Flag Link Wed Mar 6, 2013
A Hubbard is when someone puts an offer in on your house but needs to sell there home in order to buy the new house. It is simple in concept yet in reality there can be much more to it. There will be a timeline on the hubbard clause. Which means that the potential seller needs to be very realistic about what the market is warranting for a price and then work hard at getting a buyer and of course closing that deal and then moving on to yours. All in all it can be a difficult transaction but with the righ proffesional there to guide you the whole way it can be done!
0 votes Thank Flag Link Tue Aug 21, 2012
Hi Marianne and Joe
Are there any mortgage companies and or banks doing the Hubbard contingency today?
Flag Wed Apr 10, 2013
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