What is a Sale Contingency?

The sale contingency is typically used by a buyer who must sell a home before they can purchase a new one. Usually this is because the buyer can’t qualify for two mortgage loans at the same time or doesn’t want to be obligated to pay two mortgages. This is not an uncommon scenario, but it makes the sale more complex because now you must coordinate two sales at once and you have to time the closings carefully. Oftentimes a buyer and seller will agree to concurrent closings, but sometimes, the buyer of a home who is also selling, may be able to rent back from the buyer of their current home to help keep things moving smoothly and avoid any unanticipated issues. The time frame for this contingency depends on the specific scenario and the flexibility of everyone involved.