What is a “contingent offer” in real estate?

A contingent offer in real estate is characterized by its reliance on specific conditions that must be met for the transaction to proceed. This type of offer often includes clauses that stipulate particular requirements, such as obtaining financing, selling an existing property, or passing a home inspection.

For example, if a buyer submits a contingent offer based on securing a mortgage, the seller knows that the deal will only go through if the buyer successfully obtains loan approval. This allows buyers a degree of protection and flexibility, as they are not fully committed to purchasing the property until they can ensure that these conditions are fulfilled.

Other choices do not capture the essence of what a contingent offer entails. An unconditional offer implies no conditions attached, while a time-limited offer refers to the duration of validity rather than the conditions of the offer itself. Finally, there is no restriction on contingent offers being made solely for investment properties; they can apply to any type of real estate transaction. Thus, the definition focusing on the dependence on specific conditions being satisfied accurately represents the character of a contingent offer.