​​​​J. GRAHAM REALTY, LLC

J. Graham Realty, LLC

Licensed Real Estate Agency In NJ & Florida

house sale contingency ideas

4 Perry Street
Morristown, NJ 07960
(o) 973.540.1232
(f) 973.540.0008

You may need to sell your current property in order to buy your new house. Understanding a house sale contingency can be critical in being successful in purchasing your new house.  It can be negotiated in various ways but in general:


House Sale Contingency Overview: 

  • The buyer promises to buy the new house as long as their own house sells within a specified amount of time (let's say 60 days). 
  • If buyers house is not yet on the market at the time of the offer, the buyer has to list their house with a licensed real estate agent within five days after the attorney review period is completed. A copy of the listing agreement needs to be provided within 3 days of execution.
  • Buyers must provide fully executed contract of sale within 3 days of signing.
  • If at the time of the offer the buyer has their house in attorney review or under contract, the buyers will have to provide a copy of the contract upon the offer.
  • The seller of the new house can continue to market their property and accept back up offers, which is known as the “kick-out” clause.  Should another offer come in during this 60-day period, the seller can notify the original buyer that they have “x” days to remove the house sale contingency.
  • If the buyers are unable to remove the contingency (because they have not yet sold their house, or because the buyer of their house has not lined up financing yet, etc…), then the contract will become void. 



Advantages for the purchaser:  

  • You can test the waters on the sale of your own house.  If you do not sell your house, you simply do not proceed.  
  • If the sale of your own house does not go through as planned (even though you have a contract in hand), you are not at risk of losing your earnest money deposit.  This is not true for standard purchases without this clause.

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Disadvantages for the purchaser:  

  • If you are in a competitive situation on the purchase side, it is unlikely your offer will be accepted.
  • There are no guarantees that the purchase will stick.  And, when selling your own house, you have to disclose that it is contingent upon the successful purchase of your new house, which might shrink your buying pool. That is a lot of time and money spent on trying to secure a new house.

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Renting Option:

  • If you have been a renter and are looking to purchase your first house or if you sold your house and are currently renting, you can have a major advantage over another potential buyer who has to put a house sale contingency in when making an offer on the same house.
  • If you have to have a house sale contingency, if possible list your current house well before making the offer on the new house. This will allow you to be well down the road in the process of selling your current house.
  • In the worst case, if you have not yet found a house to buy, you can rent something (or stay at a hotel) for a short period of time, which will put you in a stronger purchasing position.