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What Does Active With Contract Mean In Real Estate

When it comes to real estate, the term “active with contract” can be quite intriguing. It is a phrase used to describe a property that is still listed as active on the market, but there is already a contract in place between the seller and a potential buyer. This means that although the property is technically still available, there is a high likelihood that it will soon be off the market. This unique status offers both opportunities and challenges for buyers and sellers alike.

The concept of “active with contract” in real estate has its roots in the desire to provide transparency to the market. By allowing properties to be listed as active even when there is a contract in place, it gives other potential buyers the chance to submit backup offers in case the current deal falls through. This can benefit sellers by ensuring a backup plan and also give buyers the possibility of swooping in and securing the property if the initial deal falls apart. As the real estate market continues to evolve, the concept of active with contract continues to be an important aspect to consider for both buyers and sellers.

Understanding “Active with Contract” in Real Estate

When navigating the world of real estate, you may come across various terms and jargon that can be confusing, especially if you’re not familiar with them. One such term is “active with contract,” which is commonly used in the real estate industry.

Understanding what “active with contract” means is essential, whether you’re a real estate professional or someone looking to buy or sell a property. This article will delve into the concept of “active with contract” in real estate, explaining its definition, implications, and how it affects the buying and selling process.

Before we delve into the details, it’s important to note that laws and regulations regarding real estate can vary from one jurisdiction to another. Therefore, it’s always advisable to consult with a real estate professional or attorney who is familiar with the specific rules in your area.

Definition of “Active with Contract”

“Active with contract” is a status used in the Multiple Listing Service (MLS), an online database that real estate professionals use to share information about properties for sale. When a property is labeled as “active with contract,” it means that the seller has accepted an offer from a buyer, and both parties have signed a contract.

This status indicates that the property is still technically on the market and available to other potential buyers. However, the chances of another buyer successfully placing an offer on the property are significantly reduced because the seller has already accepted an offer and entered into a contract.

It’s worth noting that the precise terminology used to denote this status may vary depending on the MLS system or the local real estate market. Some other terms that may be used interchangeably with “active with contract” include “pending” or “under contract.”

To get a better understanding of what “active with contract” means, let’s explore the implications of this status for buyers, sellers, and real estate agents.

Implications for Buyers

For buyers, coming across a property labeled as “active with contract” means that it is under contract and may no longer be available for sale. However, there are certain situations where a buyer can still make an offer on a property with this status.

In some cases, the initial contract may include contingencies that allow the buyer to submit a backup offer. If the primary contract falls through for any reason, the seller may consider the backup offer. As a buyer, it’s important to work closely with your real estate agent to understand the specific provisions and possibilities for making an offer on a property labeled as “active with contract.”

Additionally, if you’re interested in a property that is “active with contract,” it may still be worth monitoring its status. If the primary contract does not proceed as planned, the property may go back on the market, giving you another opportunity to submit an offer.

Overall, when a property is labeled as “active with contract,” it’s crucial for potential buyers to stay informed, work closely with their real estate agent, and be prepared to act quickly if the opportunity arises.

Implications for Sellers

For sellers, having their property labeled as “active with contract” indicates that they have already accepted an offer and entered into a legally binding contract with a buyer. However, the sale is not yet considered fully completed, as there may still be contingencies or conditions that need to be fulfilled.

While the property is technically still on the market, the chances of receiving additional offers are significantly reduced. Most potential buyers will be deterred from placing an offer on a property with this status, knowing that another buyer has already secured a contract.

It’s important for sellers to work closely with their real estate agent and legal representation to ensure that all necessary steps are taken to fulfill the conditions of the contract. This includes addressing any contingencies, such as inspections, appraisals, or financing, within the specified timeframe.

Sellers should also be aware of their rights and obligations regarding the sale of the property during the “active with contract” phase. They should closely review the terms and conditions of the contract and consult with their real estate agent or attorney if they have any questions or concerns.

Implications for Real Estate Agents

Real estate agents play a vital role in navigating the complexities of the “active with contract” status. They help buyers understand the possibilities for making backup offers and sellers fulfill their contractual obligations.

Agents must be knowledgeable about the specific laws and regulations governing real estate transactions in their area. They can guide buyers and sellers through the intricacies of the contract, facilitate communication between the parties involved, and ensure all necessary steps are taken to fulfill the conditions within the specified timeframe.

Real estate agents have access to the MLS, where they can monitor the status of properties and provide valuable insights to their clients. By staying informed and up-to-date, agents can help their clients make informed decisions and navigate the ever-changing real estate landscape.

Conclusion

Understanding the concept of “active with contract” is crucial when navigating the real estate market. This status indicates that a property has already accepted an offer and entered into a contract, but the transaction is not yet fully completed. It has implications for both buyers and sellers, and it’s important to consult with a real estate professional or attorney to fully understand the rights, obligations, and possibilities associated with this status.

Frequently Asked Questions

In the real estate industry, the term “active with contract” refers to the status of a property listing that is under contract but still actively marketed. It means that while the seller has accepted an offer, the sale has not yet closed, and the property is still technically available for other potential buyers to submit backup offers.

1. What does it mean when a property is listed as “active with contract”?

When a property is listed as “active with contract,” it means that the seller has accepted an offer from a buyer, and a contract has been signed. However, the sale is not yet final as there may be contingencies that need to be satisfied, such as inspections or financing. The property remains on the market and can still receive backup offers in case the current deal falls through.

It’s important for potential buyers to understand that while they can still submit backup offers, the likelihood of the property becoming available again is dependent on the success or failure of the current contract. If the current deal goes through without any issues, the property will be marked as “pending” or “under contract” and will no longer be actively marketed.

2. Can I still make an offer on a property listed as “active with contract”?

Yes, you can still make an offer on a property that is listed as “active with contract.” While the seller has accepted an offer, there is a possibility that the current contract may fall through, and the property could become available again. By submitting a backup offer, you express your interest in purchasing the property if the primary contract does not proceed.

Keep in mind that backup offers may differ in the terms and conditions compared to the primary contract. It’s important to work with a real estate agent who can guide you through the process and advise you on the best approach to submitting a backup offer.

3. How long does a property usually stay as “active with contract”?

The duration during which a property stays as “active with contract” can vary depending on several factors. It primarily depends on the terms outlined in the current contract, including any contingencies or conditions that need to be met. Common contingencies include home inspections, appraisal, and financing.

Once all contingencies have been satisfied or waived, the contract will proceed to closing. If the contract falls through, the property may become available again, and the status will change. On average, the “active with contract” status can last anywhere from a few weeks to a couple of months, depending on the specific circumstances.

4. What happens if I submit a backup offer on a property marked as “active with contract”?

If you submit a backup offer on a property that is marked as “active with contract,” the seller will typically review and consider your offer but will not enter into a contract with you unless the primary contract falls through. The backup offer serves as a backup plan in case the primary deal fails to close.

It’s essential to note that the seller is not obligated to accept or consider a backup offer. The decision to entertain or accept backup offers is at the discretion of the seller. Therefore, it’s crucial to work closely with your real estate agent to determine the best strategy for submitting a backup offer.

5. How likely is it for a property marked as “active with contract” to become available again?

The likelihood of a property marked as “active with contract” becoming available again depends on various factors. If the current contract encounters issues or the buyer fails to satisfy the contingencies within the agreed timeframe, the property can become available again. However, if the primary contract progresses smoothly and all conditions are met, the property will usually proceed to closing without becoming available again.

To get the most accurate information about the status of a property and the chances of it becoming available again, it’s recommended to consult with a real estate agent. They have access to the most up-to-date information and can guide you through the buying process accordingly.

In real estate, “active with contract” means that a property is still listed for sale, but there is a pending contract on it. This means that the seller has accepted an offer from a buyer, but the deal has not yet been finalized.

During the “active with contract” phase, the property may continue to be shown to potential buyers, but the seller cannot accept any new offers. If the pending contract falls through, the property will return to an “active” status, and the seller can consider new offers.

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