What is the meaning of contigency on a short sale How do I know if the property tax is paid?

Asked by Hileng, San Diego County, CA Fri Feb 3, 2012

My husband and I have applied for a VA loan and we have receied our Certificate of Eligibility from VA stating we are approved for $36,000 and his code is 5. We live in San Diego, according to VA website we can borrow up to $417,000 but only approved for $36000, how can we buy a house for $36000, it's a VA loan and no down payment. How come all the houses for sale said for contingency, what is the meaning of that and how do we know if the property tax has been paid by previous owner.

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Jerry Heard, Agent, San Diego, CA
Fri Feb 3, 2012
The $36,000 is the amount of the loan that the VA will guarantee the lender in case of a default on the mortgage. A lender will use that informatio as well as your income and credit to determine the maximum loan that you qualify for. $36,000 is not the maximum loan amount.
There are several stages that homes go through when they are on the market.

Active: Means that it is on the market and they are actively seeking for offers on the home.

Contingent: Means that an offer on a short sale has been accepted by the owner/seller and it has been submitted to the lender(s) who currently hold the mortgage on the home. The lender(s) have to approve the short payoff since the sale will not generate enough to pay them off in full. This process may take over a month.

Pending: Means that the offer is fully accepted and does not need any bank approval to sell the home

Sold: Hurray!! the transaction has been completed and the home is yours!!

Taxes will be brought current at the close of the escrow and the title company will insure that taxes are paid and up to date.

If you need an agent to help you through the steps of buying a home I would be very glad to help you. I work with lenders who do the VA loans and can help you and your husband get pre-approved for a mortgage then we can look for the home that works best for you.

I am never too busy for your referrals

Jerry Heard
Your Broker
The San Diego Property Shop
Direct 619-920-9796
Office 619-269-5545
Fax 619-269-9168
CA DRE # 00648687
1 vote
Sinead McAll…, Agent, Oceanside, CA
Sun Feb 5, 2012
Hi Hileng,
You definitely could use some guidance from an experienced Realtor! Feel free to contact me directly. I can search the tax roll with regard to your question about taxes and help you figure out how much house you can afford.

Sinead McAllister
0 votes
Mickey Rober…, Agent, San Diego, CA
Fri Feb 3, 2012
Contingency means the property is in escrow or sold. When you close on a home or condo, the escrow co
And title co job is to make sure all taxes have been paid by the seller before you close escrow.

Thank you,
Mickey Roberts Re/Max Associates
0 votes
Laura Coffey, Agent, Santa Clarita, CA
Fri Feb 3, 2012
When a home shows contingency it means they have a offer and are only accepting back up offers because the current contract has contengencies in place.
All CAR purchase contracts are written with contingencies built into them. Unless you remove them up front or in a counter they are built in to give you 17 days to make sure you can get a loan, the house appraises, you do your physical inspections, check with the city on permits or other intersts, review HOA documents if applicable, review seller given disclosures, a title report, and much more.
All things a local experienced Realtor can help you with and protect you.
Good Luck.
Web Reference:  http://www.laura4homes.com
0 votes
Maureen Bye…, Agent, Oceanside, CA
Fri Feb 3, 2012
Hi Hileng. Good questions. Congrats on VA cert. Property taxes are pprorated and paid through escrow when U close. Call or email me for more inventory in your price range. Your VA loan amount is based upon your income, etc. We can set up a home tour date to view the interior conditions to determine if U want to submit an offer, and if the home will be approved by your VA lenders Appraiser as VA home inspections are based upon a health and safety list just like FHA is only stricter. I have VA alllowable and non-allowable expenses information also. 'Contingent' MLS status indicates that an offer has been accepted subject to various conditions on any property, not always on a short sale. Ill send U 'Active' status only, but it can and does change per second in this local market. We just closed escrow for our VA buyer with zero down payment at 4% interest rate for a 30 year fixed loan on a short sale of which I negotiated with the Sellers Short Sale Bank to pay the entire HOA delienquent monthly dues [over 3k], $400 homeowners warranty, 3% sellers concessions towards buyers closing costs and I was able to get 1/2 of my buyers earnest money returned to him at COE. maureen@bellrealtygroup.com or 760 622 6855
Web Reference:  http://www.coastal.biz
0 votes
Mr. Weber, , Brittany Place, Fort Worth, TX
Fri Feb 3, 2012
Contingency means that the property has an accepted offer contingent upon lien approval. The bank or banks need to agree to take less than what is owed and they also have to agree to the terms of the current contract. At some point, they will order a BPO to verify current contract is near market pricing. If they find it agreeable they provide a short sale approval letter. As for the property taxes you can check out this website https://www.sdctreastax.com/ebpp3/(kiozrz45u3qtp155wgxlcc2p)/Start.aspx . Type in the address and find out whether the current property taxes are paid.

Best Regards,

Anton Weber
888 758 9268
0 votes
Janett Lewis, Agent, ST Louis, MO
Fri Feb 3, 2012
Get clear on your VA approval. If you need other lenders I can refer you to some great ones. If you are approved for $417,000 you will have no problem finding a great home!

Good Luck,

Janett Lewis
Web Reference:  http://janettlewis.com
0 votes
Marcie Sands, Agent, Poway, CA
Fri Feb 3, 2012

Daniel's answer is correct. The term contingency is most often used for properties being sold as a short sale. Unpaid taxes are not the only issue to investigage. Your agent should guide you through this process. You may want to consider a condo/townhome. If you go that route, have your lender explain to you what amount of monthly fees (HOA and mello roos taxes) you would be eligible for as that does factor into your qualifiying amount.

Kind Regards,
Marcie Sands, REALTOR
Simply The Best Real Estate Co., Inc.
0 votes
Randy Vance, , San Diego County, CA
Fri Feb 3, 2012

You can check to see if taxes are up to date by going to the SD County Tax website; https://www.sdctreastax.com/ebpp3/(4ctcqy55pdswwzfbijfip3f5)/Start.aspx

As for the $36,000 on the VA eligibility form, that is just the amount that the VA insures and is not the amount you are qualified for. Your VA Lender will be able to determine the actual amount that you could purchase a home for.

The Contingent Status on the listings means that there has been an offer accepted by the seller but it is contingent on the sellers lender(s) approving the Short Pay (Short Sale) conditions and amounts.

If you have any further questions regarding your purchase or VA Loan questions please give me a call or visit feel free to visit my website http://www.sdmilitaryrealtor.com

RAndy Vance
0 votes
Daniel Di Ma…, Agent, Chula Vista, CA
Fri Feb 3, 2012
Contingency means that an offer has been accepted by the seller and are awaiting approval by the bank/lender (typically in a short sale).
Escrow and/or your agent should be abvle to pull up tax records and confirm taxes have been paid. Typically they are prorated.
You are going to find it very dificult to find anything at that price range.
Good luck!
Web Reference:  http://www.DiMatteoGroup.com
0 votes
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