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What Does ‘Pending’ Mean In Real Estate?

Miranda Crace8-minute read
November 18, 2022

Seeing your dream home listed as “pending” can be crushing. But don’t give up hope yet – “pending” means the deal is not yet done. Real estate websites display listings as pending as soon as a seller accepts an offer on a home. However, there are a few ways that you can position yourself to take advantage of any openings that could emerge from the pending purchase agreement.

Let’s take a look at what pending means in real estate. We’ll also give you a few tips to increase your chances of disrupting the sale of a pending home.

What Does ‘Pending’ Mean In A Real Estate Listing?

In real estate, the term “pending” or “sale pending” generally means that an offer was made and accepted. The home is in the process of being sold and the sale could be contingent on things like an inspection and/or appraisal. A house will remain pending until the financing is approved, all contingencies are met and the sale is closed on.

But there are subtypes of pending sales – particularly contingent or under contract listings – and all three terms are sometimes used interchangeably, though there are subtle distinctions. 

Your real estate agent can find out exactly where in the home buying process the parties are in any particular listing.

For Statistical Purposes: A Leading Indicator

The National Association of REALTORS® publishes the Pending Home Sales Index (PHS) as a way of measuring the health of the existing home market. For its purposes, NAR defines a sale as “pending” as soon as a seller has accepted a buyer’s offer. That’s a broad definition that doesn’t distinguish between the period before contingencies are resolved and after.

In Listings

In listings – a form of writing that has its own language – various terms are used to offer information beyond the fact that the offer has been accepted.

Let’s consider some common terms you’ll encounter in listings as you hunt for a new home.

Contingent Vs. Pending

A contingent listing is a type of pending sale. If a home is listed as contingent, it means that the seller has accepted a contingent offer, typically a purchase agreement that includes a title, appraisal or inspection contingency.

If the house you’ve got your heart set on is listed as contingent, the first thing you should do is  ask your listing agent to speak to the seller’s agent. There are a variety of reasons that contingent contracts can fall through, and the parties might be at a point where the contingencies in the contract might not be resolvable.

Until the contingencies are resolved, the listing is contingent. Contingent offers don’t fall through often, but it does happen. In seller’s markets, it’s hard to get contingent offers accepted, but in buyer's markets, buyers afford themselves of the protections contingencies offer.

Your agent will be able to quickly learn why the seller is still showing the home. Many sellers choose not to show their home once they accept an offer, and the decision is entirely theirs to make.

Once contingencies have been resolved and mortgage approval seems likely, the listing should change from contingent to pending.

Pending Vs. Under Contract

A home under contract means that the seller has accepted a formal offer on a home, but the sale isn’t close to completion due to unmet contingency requirements. For NAR, this is a pending sale, and it will be included in its index.

There are no hard and fast rules about listing categories, and there are regional differences as well, so to find out exactly where in the process the seller and buyer are, call your real estate agent and ask them to find out. In general, a pending property is more likely to move to closing than a property under contract.

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Can A Pending Home Sale Fall Through?

There are a few reasons why a buyer might cancel a home sale. Let’s take a look at some of the most common reasons.

An Unsatisfactory Inspection

An unsatisfactory home inspection can cause a pending sale to fall through. But what is an inspection and why is it such a big deal? During a home inspection, a real estate expert takes a tour of the home and records everything that needs a repair or a replacement. At the end of the inspection, the inspector gives the results to both the buyer and the seller.

Most offer letters include a clause that allows the buyer to cancel the sale if the inspection reveals something seriously wrong with the home. However, before the buyer backs out of the sale, they might give the homeowner a chance to rectify the issue.

For example, the buyer might ask the seller to fix a broken heating system or offer an extra discount. If the seller and the buyer can’t reach an agreement, the buyer can cancel the sale. In this instance, the home’s pending status will go away and the home will show up on real estate databases – such as the multiple listing service – as “for sale” once again.

Failure To Find A Mortgage

The majority of buyers use a mortgage to purchase a home. If a buyer can’t get a mortgage, they will need to cancel the sale, unless they’re buying in cash.

There are plenty of reasons why a buyer might not be able to get a mortgage. Any of these circumstances can lead to sale cancellation:

  • The buyer might run into a financial emergency and may need to drain their down payment fund.
  • In verifying the buyer’s income and assets, the mortgage lender could discover inaccuracies that could change the amount a buyer is approved for.
  • Finally, if the lender believes that the buyer is trying to use a loan for their down payment, they will pull their funding offer.

Short Sale Failure

A short sale is a special circumstance in which the seller agrees to sell their home to avoid falling into foreclosure. The bank agrees to accept less money than the homeowner owes under the condition that they sell the property.

After the homeowner sells the property, they transfer the entirety of the sale price to the lender. In exchange, the lender wipes away the seller’s debt.

The lender must approve the home’s final selling price. However, the home will usually show up as pending as soon as the seller accepts an offer. If the lender vetoes the sale and demands the seller put it back on the market, you can swoop in and buy it.

Buyer’s Remorse

Buyers sometimes simply have a change of heart and decide that they don’t want a particular home anymore. The buyer might have experienced a change in their life that forces them to cancel the sale.

For example, let’s say a buyer gets relocated for a job. They may need to cancel the sale and find a home in their new city. This is a rare circumstance, but it can happen.

Clouds On The Title

Another problem that can delay or derail a sale is a title defect, likely discovered during the title search required by your lender. A problem with the title could be easily resolvable. For example, if the homeowner is behind on their taxes or homeowner’s association fees, there might be liens placed on the property that can be removed if the homeowner pays their debts.

On the other hand, if they can’t pay the debt, and you proceed with the sale, you’ll be required to pay those debts because liens stay with the property. In other words, they don’t follow the homeowner; their debt becomes your debt.

Can You Make An Offer On A Home If A Sale Is Pending?

Buying a home with a pending sale is difficult – but not impossible. Most offer letters include clauses stating that the home seller can’t cancel the sale if a higher offer comes in. This means that you can’t simply bump the current buyer out by offering more money. The buyer will need to cancel the sale first before the seller can consider your offer.

If you do have serious interest in a pending home, you can submit a backup offer for consideration in case the pending offer falls through. Real estate agents rarely recommend this course of action as it’s unlikely to pan out in your favor, and it can tie you up and make it difficult to bid on other properties.

When Do I Have The Best Chances Of Disrupting A Previous Purchase Agreement?

If the offer has only recently been accepted, and the buyer has included a mortgage loan or inspection contingency in the purchase agreement, you have a higher chance of disrupting the current deal. Your chances of success plummet if all contingencies have already been resolved and the paperwork is in underwriting, the final stage of the approval process.

It’s because the purchase agreement has yet to harden into a contract while contingencies are being resolved. But you’ll need more than a higher bid – you’ll need to wait in the wings for a problem or an opportunity – depending on your perspective – to present itself.

For example, if the buyer must get approved for a mortgage, or is awaiting the results of the home inspection report, the appraisal or the title search, there might be an opportunity for you to move in with a higher bid to make the seller less willing to negotiate with the first buyer if issues arise.

Can An Agent Still Show A Home If It’s Pending?

Until all the paperwork closes, a pending home is technically still on the market. Many real estate agents will still allow you to see a home, even if it has a pending offer, but this depends largely on the wishes of the seller.

If the seller is confident in the pending offer, they may not want to allow any more showings. Your agent can get in contact with the seller’s agent and see if you can still schedule a showing.

The Bottom Line: Don’t Count Yourself Out Until The Other Sale Closes

Though most pending home sales go to closing, a deal can still fall through if the seller can’t get funding, changes their mind about the sale or finds a problem with the home. “Pending” doesn’t mean the same thing as “sold,” so there’s still a chance that you can swoop in and take the home.

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Miranda Crace

The Rocket Homes blog is here to bring you all you need to know about buying, selling and making the most of your home. Whether you’re thinking about becoming a homeowner, selling your current home or looking to keep your place in tip-top shape, our writers and freelancers bring their experience and expertise to meet you right where you are.