Author

Shelly Salas

I often speak with homeowners who reach a point where they’re ready to move up for more space, a different neighborhood, or a better fit for their lifestyle. One of the most common questions in this situation is how to move up to a new home while still owning your current one. This is where contingency offers come in. They allow a buyer to make an offer on a new home while still needing to sell their existing property first. While they can provide protection, they also come with conditions that must be clearly understood before moving forward.

A contingency offer allows a buyer to purchase a new home only if their current property sells first. This can provide peace of mind because the buyer depends on the proceeds from their existing home to complete the purchase. If the sale does not happen by the agreed deadline, the contract may terminate and earnest money may be refunded.

For move-up buyers, this strategy can reduce financial pressure. Instead of carrying two mortgages, the buyer can focus on transitioning from one home to the next. However, strict timelines often apply, and missing deadlines can create costly complications. Buyers should review all contract terms carefully with their agent before submitting contingency offers.

From a seller’s perspective, contingency offers introduce uncertainty. The concern is whether the buyer’s home will sell within the required timeframe. That uncertainty can lead to hesitation, especially when cleaner offers are available.

In competitive situations, sellers often choose offers without conditions because they provide more certainty. This is where buyers can feel pressure or hesitation when using contingency offers, since they may be competing against stronger, non-contingent offers.

At the same time, it’s important to note that contingency offers are still valuable in the right situation. In slower markets, or when a seller is more flexible, they can make it possible for a buyer to move forward without selling first under pressure. The key benefit is still protection, buyers are not forced to carry two homes or risk financial strain.

Contingency offers can be a practical solution for homeowners who need to sell before buying again. They offer protection and flexibility, but they also carry risks that can affect both timing and competitiveness. Before using this strategy, buyers should evaluate market conditions, financing options, and contract deadlines. With the right plan, a contingency offer can still help make a successful move-up purchase possible.