There are many contracts and legal terms involved in a home purchase. Some of the common terms one might hear when buying or selling real estate include “pending” or “under contract.” It is important to that Georgia buyers and sellers understand the obligations present in a contingent agreement. Prospective buyers should also be familiar with these terms as they seek to respond to listings.
When an individual wishes to buy a property, an offer is often put forth with certain contingencies. This means that certain criteria must be met in order for the agreement to be binding; for example, inspections, mortgage approvals and appraisals. These properties will be listed as “pending” or “pending contingencies.” Depending on the contingencies involved, the seller may or may not be open to other offers during this period.
“Under contract” is a term that means that all contingencies have been met and the sale is proceeding. At that point, one might consider the sale to be final; however, on occasion listings are posted as “under contract” when the mortgage requirement is still outstanding. In these cases, other offers could be considered if the mortgage requirement falls through.
Understanding ones legal obligations is critical when agreeing to a real estate contract is critical. Failure to do so could lead to legal consequences and confusion; for example, if a seller receives a competitive offer when awaiting contingencies, it is important that an appropriate response is made so that the initial agreement is not breached. To better understand the stages of contracting involved in a real estate transaction, it is a good idea to involve a real estate lawyer early on.