What Is a Home Sale Contingency, and Will Sellers in Crystal Lake, IL Accept One?

What is a home sale contingency, and will sellers in Crystal Lake, IL accept one? A home sale contingency makes your purchase depend on selling your current home, and whether a seller accepts one depends mostly on how fast homes are selling and how much they want the home you are buying.

Laurie Arslani is a REALTOR® with eXp Realty in Barrington, IL helping sellers price, prepare and sell with a plan. I work with sellers across Crystal Lake, Algonquin, Lake in the Hills, Huntley and Barrington. This question comes up when a seller finds a home they love before their own home has sold, and they are worried about owning two homes.

A contingency is one way to handle that. It is not the only way, and it is not always the best one. Here is how I explain it to my clients.

A home sale contingency is a condition in your offer. It says your purchase depends on selling your current home.

A home close contingency is a close cousin. It says your purchase depends on your current home closing.

Both are meant to protect you. If your home does not sell or close, you are not stuck owning two homes. The tradeoff is on the other side of the table, because the seller of the home you want is now waiting on something outside their control.

Most sellers prefer a clean offer, one with no conditions attached. A clean offer feels certain. An offer that depends on another home selling feels uncertain, because the seller is waiting on a sale that has not happened yet, with a buyer they have never met.

When a seller has other offers to choose from, the clean one usually looks stronger. That is the main reason a contingency makes your offer harder to win.

It depends on the market and on the home.

When homes are selling fast, sellers often won't accept one. When the market is more balanced, they often will.

The home itself matters too. If it is a hot property at a good price and you really want it, I don't advise writing the offer with a contingency. That is the situation where a contingent offer is most likely to lose, and where it is worth looking at your other options first.

A contingency can make sense when you need the money from your current home to buy the next one, and you cannot sell first or line up other funds. It can also work when the home you are buying has been on the market a while and the seller is open to it.

If your home is already under contract, the picture is different, because you know your timeline and your proceeds. A home close contingency tied to a sale that is already under contract may be easier for a seller to accept than a sale contingency tied to a home that isn't under contract yet.

If you are not sure which situation is yours, call me before you write an offer. We will look at your numbers and your timeline together.

You have four other options. I explain each one in more detail in my other articles.

1. Sell your home first. For most sellers, this is my usual advice. You know your proceeds and your timeline, and you shop with a clear budget. I have closed numerous same-day double closings for my clients, selling one home in the morning and buying the next that afternoon. Should I Sell My House First or Buy First in Huntley, IL?

2. Use other funds. If you do not need the proceeds from your current home to buy the next one, you can write a clean offer. I had clients who borrowed the funds from a parent, moved into the new home first, sold their old one, and repaid the loan when it sold. If you are thinking about using money from family, ask your lender and your attorney how a loan like that should be handled before you write an offer. Can I Buy a New Home Before My Current Home Sells in Algonquin, IL?

3. Use a bridge loan. A bridge loan is short-term financing that lets you use the equity in your current home to buy before you sell. It is paid off from the proceeds when your home sells. Each lender sets its own rules, so ask yours first. How Do I Make an Offer on a Home If Mine Isn't Under Contract Yet in Barrington, IL?

4. Plan a rent-back if the dates do not line up. A rent-back means you close on your sale and stay in the home for an agreed number of days, paying the new owner while you are there. As a rule of thumb, I suggest setting the rent at the new owner's monthly housing payment, divided by the days in the month and multiplied by the days you stay. Your attorney writes up the final terms.

Tell the other agent your plan. The agent on the other side, and their seller, should understand how your sale fits with their closing. A seller who understands the plan is more comfortable than one who sees a question mark.

Have a backup. If your dates might not line up, talk to me about a rent-back or another option before you write the offer, not after.

Take your time. This is probably the biggest investment you will make in your life, so you owe it to yourself to think it through. I don't like rushed decisions.

Writing a contingent offer on a house everyone wants. In a competitive situation, a clean offer usually wins. If you need to be clean, sell first or line up other funds.

Assuming every seller will say yes. What works in one market may not work in another. Ask me what sellers are accepting right now.

Not telling the other agent the plan. Everyone involved should know the order of the closings before the day arrives.

Counting on a sale date that is not set. If your home is not under contract, the closing date is a guess. Build in a backup before you promise a date.

Rushing. A rushed offer on a house this size is almost never a good one. I would rather slow a client down than hurry them.

What is a home sale contingency?
A home sale contingency is a condition in your offer that makes your purchase depend on selling your current home. A home close contingency is similar, but it depends on your current home closing.

Will sellers in Crystal Lake, IL accept a home sale contingency?
It depends on the market and the home. When homes are selling fast, sellers often won't accept one. When the market is more balanced, they often will. On a hot property at a good price, I would not write the offer that way.

Is a home sale contingency a good idea in Huntley, IL?
It can be, when you need the proceeds from your current home and you cannot sell first or use other funds. It is also the weaker offer in a competitive situation. I look at your numbers, your timeline and the home before I recommend it.

What can I do instead of a home sale contingency in Barrington, IL?
You can sell first, use other funds, use a bridge loan, or plan a rent-back if the dates do not line up. For most sellers, I recommend selling first.

Can I buy a home in Algonquin, IL before mine sells without a contingency?
Yes, if you do not need the proceeds from your current home to make the purchase. That usually means using other funds or a bridge loan. Otherwise, selling first is the safer plan.

If you are thinking about writing an offer before your home sells, call me first. Tell me where you are now and where you want to be, and we will figure out the order together. You can see how I sell a home in Crystal Lake or read how I work first. Not sure yet? Read what my clients say on Google.

Laurie Arslani is a REALTOR® with eXp Realty in Barrington, IL helping sellers price, prepare and sell with a plan.

Phone: 847.804.9595
Website: lauriearslani.com