While a concurrent closing contingency can be a good idea, it must be used sparingly and with a closed ended limit.
We Buy Houses – North Richland Hills TX: A contingency plan for home buyers is something you, a home seller, should definitely know about. Why? Because it could be a strategy that you can use to help you find a new home, secure the funding, and hold the house until you can get yours sold. This clever move is something you can actually use to help your buyers as well. You may have a buyer that can’t afford to pay for your house and their unsold old house, too. You can help them to make the purchase of your home but hold off on it until their house is sold and they can move forward with their plans.
There are definitely plusses and minuses for both parties when a concurrent contingency is written into the contract. In essence what is can mean is that you will only allow your buyer to close on your house when you have found a house to move into. It can also work the other way around and lock you, the seller, into waiting until the buyer’s house has sold. As you can imagine, if this contingency was written into every sale contract down the line of your buyer-seller connected sales, no one would ever be able to move.
“While this all seems like it wouldn’t really work out for somebody, it does actually make life easier for a few who are able to use it to their advantage and for a specified period of time.”
The buyer could wish to wait until his house sold before closing on yours. What if his buyer wanted the same consideration? Your buyer would have to wait until his buyer was ready when HIS buyer was ready, and so on. You get the point, don’t you? While a concurrent closing contingency can be a good idea, it must be used sparingly and with a closed ended limit. There should be a time period for the contingency plan that, once exceeded, can let the parties affected out of the contract.
While this all seems like it wouldn’t really work out for somebody, it does actually make life easier for a few who are able to use it to their advantage and for a specified period of time. Giving yourself a few extra weeks in which to find a new home before your buyer takes possession seems reasonable enough. Make sure that everyone involved is fully aware of what is involved in the process and the timeline that you will be requesting. Perhaps it is just as wise to put aside a few extra months worth of rent money that you can use in case you don’t find the right house before the buyer is set to move in.
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Real estate Investor, Broker, and private money expert. Adventurer that lives life to the fullest. John is also the author of Attracting Private Money Lenders & 17 Vital Keys To Creating Wealth While Building A Profitable Real Estate Investment Business.
Attracting Private Money Lenders: And 17 Vital Keys To Creating Wealth While Building A Profitable Real Estate Investment