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(Posting in IL): First some background--we received a contract on our condo a few weeks ago. We've had the home inspection and the buyer has secured financing. Basically, we're just waiting for the closing now (which was agreed to be end of October). Our buyer is moving from a rental so he has no "contingencies."
Our agent keeps referring to our putting an offer on a new home as our having a "contingency" and that sellers will be less likely to work with us due to this. She won't even schedule property showings for sellers who state "no contingencies please". Is ours really a contingency in the true sense of the word? I would think we'd be much more desirable than someone who hasn't even listed, or if they're listed, doesn't have a contract. Just looking for some advice because her "advice" is starting to get frustrating. Thanks in advance!
Well the purchase of your new house is contingent upon the sale of your condo correct?
So, your agent is a touch over the top in not even scheduling showings for houses which want no contingencies. Granted, the end of October is still a long time out, but you can still view a property... you don't have to make an offer. Houses are sitting on the market for 6 months at a time these days. Even if they say no contingencies you could still make an offer with one... worst case they just say no.
In addition, I'm assuming you told your Realtor you won't buy until your condo sells? If this isn't the case, maybe your Realtor doesn't understand what you want. Either way, you're in contract now, so you'd be a much more desirable buyer in my eyes vs. someone who isn't in escrow and must sell a property before they were to buy mine.
That Realtor works for you... don't forget that, and you can remind them of that. Dropping a buyers agent is much easier than a selling agent... they would likely still qualify for a commission on properties they have "introduced" you to... so if you actually like any of the houses they have shown you, you may want to stick with them.
I'm amazed that there are that many houses that actually say that unless it's really due to some other reason.
If this agent won't show you the properties, I might start looking for another agent. Could be that the commission is bad on those houses and they just don't want to show them.
To me, you'd be a good buyer to show a house to even though things could fall through from now until your closing. With so much inventory, you really need to get out there and line stuff up, making sure you're picking the right house.
DanielleS - to answer your question directly, yes, you would have to make an offer on your next home "contingent on the successful close of the pending sale" of your current home. However, that contingency is MUCH BETTER than "contingent on the sale and successful close . . . " It is true that a home isn't truly "sold" until it closes escrow, however you're through the "danger period", and there's absolutely no reason why sellers would not want to enter into a contract with you. What sellers are very reluctant to do is wait for someone who has a house to sell. In this market that could take months! So that's understandable.
While your negotiating power might be slightly stronger after your present home closes, now is the best possible time to find your next home. Thus you could potentially do a "simultaneous" close and make only one move vs having to rent something until you find your next home.
Personally I am shocked at your agent's attitude. Is this person new in the business? If not, I can't imagine why she couldn't convey to a seller's agent that your offer is not shaky and that it may be the best (and only) offer they might get for several months.
Last edited by Gretchen B; 09-06-2007 at 12:45 PM..
Reason: clarity
(Posting in IL): First some background--we received a contract on our condo a few weeks ago. We've had the home inspection and the buyer has secured financing. Basically, we're just waiting for the closing now (which was agreed to be end of October). Our buyer is moving from a rental so he has no "contingencies."
Our agent keeps referring to our putting an offer on a new home as our having a "contingency" and that sellers will be less likely to work with us due to this. She won't even schedule property showings for sellers who state "no contingencies please". Is ours really a contingency in the true sense of the word? I would think we'd be much more desirable than someone who hasn't even listed, or if they're listed, doesn't have a contract. Just looking for some advice because her "advice" is starting to get frustrating. Thanks in advance!
Unless you are capable of proceeding with the purchase and closing on any offer you make regardless of the successfulness of the sale of your condo, you in fact have a contingency. Only if you can keep your condo and still be able to close on the purchase of another property are you contingency free.
I am amazed with the current market as poor as it is in some places and the possibility of a market wide problem that a seller would actually limit his buying pool like that..... Hope it happens around me, that will give me more chance!
If the seller is working with a relocation firm (eg corporate relo), they often have to refuse any offers that include contingencies.
We're in the middle of a corporate relo with our house on the market at what we consider a low price vs comps. But since there is a 90% / 5mo buyout clause, the relo firm will not accept any offers with contingencies. It greatly limits our ability to sell our house in this market, but it does weed out people who can't get the deal done before a buyout would kick in. And we don't have a choice.
We hope desperately not to have to resort to the buyout, so we've intentionally priced our house to sell soon.
The fact that you have a good offer on your house should make a difference if you want to purchase now. There is no reason your lawyer cannot continue to show the house - if that is in the agreement. But thee is a potenial problem. Here it why.
You have a "good" offer from Buyer A; the closing is set. Now comes Buyer B who offers a cash sale for the same amount of money. The house will close as soon as the paperwork is ready. It's a tempting offer. Except...
If you back out on the first contract you not only owe an amount equal to the downpayment to Buyer A because you quit the contract, you also pay ALL of the expnses this buyer incured to date. Inspections, time off work, mileage and travel time, loan generation fees, fees to bring the paperwork up to date, etc.. It's endless, and its messy.
The question then becomes: How much money can you afford to lose to get that fast sale? Government loans typically take longer to close than the common home morgage through a bank. This may account for the October closing.
(Posting in IL): First some background--we received a contract on our condo a few weeks ago. We've had the home inspection and the buyer has secured financing. Basically, we're just waiting for the closing now (which was agreed to be end of October). Our buyer is moving from a rental so he has no "contingencies."
Our agent keeps referring to our putting an offer on a new home as our having a "contingency" and that sellers will be less likely to work with us due to this. She won't even schedule property showings for sellers who state "no contingencies please". Is ours really a contingency in the true sense of the word? I would think we'd be much more desirable than someone who hasn't even listed, or if they're listed, doesn't have a contract. Just looking for some advice because her "advice" is starting to get frustrating. Thanks in advance!
Basically buying your new place is contingent on selling your old place.. becuase you will not get a mortgage for place #2 if your current place's deal falls through. If you are competing with offers from someone like your buyer (who rents and has no true contigencies) than yes, you are less desireable.
But.. in this market you probably do not have much competition.. and lets face it.. a lot of people are buying their second home , thery are not all first time homebuyers, and this typically occurs.
Your Realtor should be reassuring the agent for the seller on your purchase that your buyers on YOUR home are good buyers (if they are truly good I would be telling the agent that is selling th home your buying that the buyers on your home has excellent Fico scores, good down payment and that everything is looking good on your sale..etc.).
They won't NOT take your offer because you are selling. You are more attractive to a seller if you are already on the market... but more so if you already have a contract signed on your sale (which, honestly, in this market you shouldn't be putting offers in on new places unless and until you have abuyer lined up for your first place, or you can close on one without closing on the other).
If you can close on one without closing on the other, you should tell them that .. but that risk will be yours.. and is only true if you qualify for your new mortgage with the first mortgage still active.
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So that's understandable.
