What Does "Contingent" Mean In Real Estate?

In the world of real estate, there are many words that your everyday homebuyer -- and even some real estate agents new to the field -- may not be able to define. One of these terms is “contingent.” This is a word that homebuyers and real estate professionals alike should know and understand. Basically, what the word “contingent” or “a contingency” means is that there is a condition that is written into the contract. In order for the contract to be legally binding, the listed condition must be met. An excellent example of a contingency in a contract is when the buyers of a home include a clause that states the contract is not binding until a satisfactory home inspection from a qualified home inspector is completed. Once the inspection has been completed, the contract is then legally binding. As a homebuyer or a real estate agent, you will find that there are several different types of contingent statuses. The first one is known as “contingent show.” This means that there is a contract on the property, but the owner is still willing to show the property and will accept offers as back-up offers in the case the offer that is currently on the table fall through. A second type of contingent status is called “contingent no show.” In this case, the contingency status means that the seller has a contract on the property that they believe will not fall through, and the seller no longer wants to show the property to other prospective buyers. In simple terms, it means that the property is off of the market. The last of the contingent clauses is known as “contingent with kick-out.” This is a common phrase to put into a contract. It means that if there is currently an offer on the property, but a better offer comes along, the seller has the option to accept the better offer. In other words, the better offer will “kick out” the current offer. This clause helps the seller get the best deal available. If the contract states “contingent with no kick-out,” it simply means that there are no other offers being accepted. If the current contract happens to fall through, then the property will show as active, and new offers will be considered. Related real estate articles on Contingent:
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