Home Sale Contingency
A home sale contingency makes your offer to buy a new home conditional on selling your current one first — it protects you from owning two homes at once, but sellers hate it.
Here’s the scenario: you own a $280K home and want to buy a $350K home. You need the equity from the sale of your current house to fund the down payment on the new one. A home sale contingency gives you time to sell before you’re committed to buy.
The problem? In a competitive market, sellers often reject offers with this contingency because it adds uncertainty and delays.
How It Works
The contingency sets a deadline — typically 30–60 days — for you to sell your current home. If it sells, great. The deal proceeds. If it doesn’t sell by the deadline, you can either extend (if the seller agrees) or walk away and get your earnest money back.
Some sellers accept home sale contingencies but add a kick-out clause — they can keep marketing the home and accept a better offer if one comes along. You’d get 48–72 hours to remove your contingency or lose the deal.
Watch out for: Overestimating how quickly your home will sell. If your agent says your home will sell in 30 days and it takes 60, you could lose the new home. Price your current home aggressively, list it before you make offers, and consider a bridge loan as backup. Your buyer’s agent can help you time both transactions.
Alternatives to a Home Sale Contingency
- Bridge loan: Short-term financing that covers both mortgages
- HELOC: Borrow against your current home’s equity for the down payment
- Sell first, rent back: Sell your home, negotiate a rent-back, then buy
- Sell first, find temporary housing: The cleanest option but the most disruptive
On a $350K purchase with $70K needed for the down payment, a bridge loan might cost $2,000–$4,000 in fees — worth it to avoid losing the home you want. Use our mortgage calculator to model the numbers.
Will sellers ever accept a home sale contingency?
In a buyer’s market, yes. When homes sit on the market for weeks, sellers are more flexible. In a seller’s market with multiple offers, almost never. If you must include one, strengthen your offer in other ways: offer above asking, increase your earnest money, or shorten the contingency timeline. Check our glossary for kick-out clause details.