Should I Accept a Contingent Offer on My House? What You Need to Know Before Saying Yes or No

Accepting a contingent offer on your home can feel like a gamble – but it doesn’t have to. Whether you’re selling your home in Kansas City, MO and looking to rent a home in Portland, OR or an apartment in Los Angeles, CA or even if you’ve got a home sale contingency on your own offer to your new home, understanding contingent offers can help you navigate the process of selling your home with more confidence. 

The short answer to whether you should accept a contingent offer on your house is that it depends. If you haven’t had a ton of offers, it’s okay to accept a contingent offer as there’s no real drawback aside from the deal potentially falling through. On the other hand, if your property is getting considerable attention, it might be wise to hold out for a better offer without any potential for it to not go through. This Redfin article will help you navigate the confusing world of contingent offers, so you can make the right choice for you and your home.

In this article:
What is a contingent offer?
What kind of contingent offers are there?
How often do contingent offers fall through?
Should I accept a contingent offer on my house?
The bottom line: knowledge is power

What is a contingent offer?

A contingent offer is an offer that goes through only when certain conditions are met. If those conditions are not met, the buyer has the option to back out of the contract. Most offers involve some sort of contingency, and certain contingencies are especially popular in buyer’s markets where buyers have control. In a seller’s market, the seller may have an abundance of offers. One way buyers will make their offer stand out is to waive their contingencies. 

What to know: A contingent offer is an offer that is finalized only when certain conditions are met. 

What kind of contingent offers are there?

There are several kinds of contingencies, ranging from home inspection to home sale, and it can be confusing to know what to expect when receiving a contingent offer. Working with a Redfin real estate agent can help distill this information down and make it a lot less confusing. 

Here are a few of the different types of contingencies you make come across:

• Home inspection contingency: Allows the buyer to back out of a purchase contract if the home inspection reveals major issues with the property. If the buyer wants to continue with the sale, they can request repairs or lower the purchase price.
• Mortgage contingency: Gives the buyer a specific period of time to get home financing
• Appraisal contingency: Usually used for lender protection. A lender requires an appraisal before agreeing to provide mortgage financing. If the home appraises for less than the purchase price, the lender won’t lend the money. The buyer can either renegotiate the purchase price down or make a larger down payment to cover the difference.
• Title contingency: Ensures the home has a clean title free of liens or encumbrances.
• Home sale contingency: The deal goes through if the buyer’s home sells first.

Key points: There are many different contingent offers with the most common one being the home inspection contingency, but it’s a good idea to be familiar with other types of contingencies should you run across them.

How often do contingent offers fall through?

Contingent offers do run the risk of falling through, which is a risk you should be aware of if you’re choosing to accept a contingent offer, but it doesn’t happen as often as you’d like. According to a survey from the National Association of REALTORS in early 2024, only 5% of sales contracts on homes were terminated with 13% of sales contracts during those months being delayed before being settled. 

What to remember: A contingent offer may fall through, but it’s much more likely that it will clear.  

Should I accept a contingent offer on my house?

The short answer is that it depends. Accepting a contingent offer on your house is a personal decision and depends on your expectations around the sale of your home. How quickly do you need to sell your home? Do you need the money to move on to your next property? How much attention has your home gotten since it’s been on the market?

If your home has been listed for several weeks, accepting a contingent offer can be advantageous. Even if the deal falls through, you won’t have to deal with relisting your property. On the other hand, if you’ve had significant interest and multiple offers, selecting an offer where the buyer has waived contingencies will ensure the deal closes without any hiccups. Despite the slight risk that contingent offers pose, it’s usually in your best interest to accept the highest offer even if that carries a contingency you’re poised to deal with.

In a nutshell: Accepting a contingent offer depends on what you need out of the sale and the market conditions. If you haven’t had much interest, it’s perfectly okay to accept a contingent offer. However, if there are multiple offers – or even a bidding war – you can be more selective over whether to accept a contingent offer or not.

The bottom line: knowledge is power

Contingent offers are a common part of today’s real estate landscape. While they can introduce a bit of uncertainty, they also present opportunities, especially in slower markets or when buyers are serious but need time to line up financing or sell their current home. The key to navigating this confusing world is to understand what type of contingency you’re dealing with, how it aligns with your goals, and how much flexibility you have in your timeline.

Before saying yes or no to a contingent offer, weigh the level of interest your home has generated, assess your urgency to sell, and consider the buyer’s likelihood of securing financing. With a thoughtful approach and the guidance of an experienced Redfin real estate agent, you can confidently decide whether accepting a contingent offer is the right move for you and your home.

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