When you start your journey to find a new home, you may come across listings that say “under contract” or “active under contract.” If you’re interested in purchasing a home that is under contract, you might be wondering if you can still make an offer.
In this informative article from Redfin, we will explain what it means when a home is under contract and whether you can still make an offer on such a property. Whether you’re exploring homes for sale in Milwaukee, WI or condos in Houston, TX, read on to learn more about homes that are under contract.
Understanding “Under Contract” in Real Estate
When a property is listed as “active under contract,” it means that a buyer has made an offer that the seller has accepted. However, certain conditions still need to be met before the sale is finalized. Once all requirements are fulfilled, the status of the home will change to “sold.”
During the under-contract phase, various contingencies must be satisfied before the sale can be completed. This could include securing financing, completing a home inspection, or meeting other specified conditions outlined in the real estate contract.
Real estate contracts lay out the terms that both the buyer and seller must adhere to. Failure to meet these conditions could lead to the termination of the contract, depending on the agreed-upon terms.
Distinguishing Between “Under Contract” and “Pending”
A property that is “pending” has had all contingencies removed, requirements fulfilled, and is nearing the closing stage. Essentially, a pending property is closer to being sold than a property that is under contract.
- Under Contract: Contingencies are still in place, backup offers may be considered, and the closing process is in progress.
- Pending: All contingencies have been met, backup offers are unlikely to be accepted, and the closing date is approaching.
Is an Under Contract Property Off the Market?
If you come across a property that you love but is listed as under contract, you may still have options. There is a chance that the buyer or seller may fail to meet the necessary conditions for the sale to be finalized.
While most under-contract properties are off the market, the buyer typically has a specified timeframe to fulfill their obligations. During this period, properties may still be advertised but will retain the “active under contract” status until the sale is completed or the transaction is canceled.
Can a Seller Accept Another Offer While Under Contract?
During this phase, the seller may entertain backup offers. A backup offer with favorable terms, such as a higher price or fewer contingencies, may catch the seller’s attention.
Numerous issues can arise during the under-contract period, leading many homes to return to the market. A study conducted by Redfin in December 2025 revealed that nearly 16.3% of home-purchase agreements were canceled. By submitting a backup offer, you position yourself as the next potential buyer should the current contract fall through.
Understanding Backup Offers
A backup offer is a secondary offer made after the seller has already accepted one, placing you next in line if the original deal doesn’t materialize. Sellers may indicate that they are open to backup offers if they have concerns about the current offer falling through. If you have your heart set on a home that is under contract, it’s advisable to contact a real estate agent promptly to explore your options for making an offer.
FAQs About Under Contract Properties
What Contingencies Must Be Met While Under Contract?
Several contingencies could cause the deal to fall through if they are not satisfied during the under-contract period. The most common include:
- Financing Contingency: Also known as a “mortgage contingency,” this allows the buyer to back out if they cannot secure mortgage approval.
- Home Inspection Contingency: Enables the buyer to withdraw from the deal if the home inspection reveals significant issues.
- Home Appraisal Contingency: Allows the buyer to exit the deal if the home appraisal is lower than anticipated.
- Home Sale Contingency: The buyer’s offer may be contingent on selling their current home. If they cannot sell within a specified timeframe, they may opt out of the current deal.
What Are the Main Reasons a Home Sale Might Collapse?
Issues discovered during a home inspection, financing difficulties, and appraisals below expectations are the primary reasons a home sale could fall through. Financing and appraisals are often interlinked, as a low appraisal could lead to a mortgage lender rejecting the application due to the home’s value.
How Long Does a Home Typically Stay Under Contract?
Homes are usually under contract for 30 to 60 days, although this timeframe can vary depending on financing arrangements. For instance, a cash offer might only be under contract for 15 days.
What Happens While a Home Is Under Contract?
Five essential steps occur before the home is officially sold.
- Offer Acceptance: Both parties sign the home purchase agreement, and the buyer provides earnest money, a deposit equal to approximately 1 to 3% of the purchase price.
- Contingency Period/Closing Process Initiation: During this period, a home inspection takes place, the buyer applies for a mortgage, and the closing process commences.
- Appraisal and Mortgage Approval: The lender requests an appraisal to confirm the home’s value. If the appraisal aligns with the offer price, the mortgage is likely to be finalized.
- Final Walk-Through: The buyer conducts a final inspection of the home to ensure its condition and verify that any agreed-upon repairs have been completed.
- Closing Day: The buyer transfers funds, signs documents, and the home officially changes ownership.
Is an Under Contract Home Already Sold?
No, an under-contract home is not yet sold. It indicates that an offer has been accepted, but certain conditions must be met before the sale can be finalized. Once the closing process is completed, the home is officially considered “sold.”