If you are searching for a home, you may have come across listings labeled “Active Under Contract” and wondered what it means. This term can be confusing, especially for first-time buyers and sellers. In this guide, we will explain the meaning of “Active Under Contract,” how it affects buyers and sellers, and what steps you can take if you’re interested in a property with this status.
Definition of Active Under Contract
Active Under Contract means that a seller has accepted an offer from a buyer, but the deal is not yet final. The home is still technically available for showings and backup offers in case the primary contract falls through. This status is commonly seen in real estate listings and serves as an indication that the sale is in progress but not completed.
How Active Under Contract Affects Buyers
For buyers, seeing a home listed as Active Under Contract can be frustrating, but it does not mean the property is completely off the market. Here’s what you need to know:
- You Can Still Submit an Offer: Some sellers accept backup offers in case the first deal fails.
- Limited Availability for Showings: While the home is technically available, the seller may restrict further showings.
- Contingencies May Cause Deals to Fall Through: The accepted offer may include contingencies like financing, home inspections, or the buyer selling their current home. If any of these conditions aren’t met, the deal may be canceled, giving you a chance.
How Active Under Contract Affects Sellers
For sellers, listing a home as Active Under Contract provides some flexibility while keeping their options open. Here’s what it means for them:
- Secured Offer But Not Closed: A buyer is under contract, but the deal isn’t finalized until all conditions are met.
- Can Accept Backup Offers: This ensures that if the first offer falls through, they have a second option ready.
- Limited Market Exposure: Although still visible to buyers, some may skip over the listing, assuming it’s already sold.
Differences Between Active Under Contract and Pending
Many buyers and sellers confuse Active Under Contract with Pending status. Here’s how they differ:
| Status | Meaning |
|---|---|
| Active Under Contract | Offer accepted, but contingencies remain. Seller may still accept backup offers. |
| Pending | All contingencies are met, and the home is close to closing. The seller is no longer accepting backup offers. |
What to Do If You’re Interested in an Active Under Contract Property
If you see a home listed as Active Under Contract, here are some steps you can take:
- Contact Your Real Estate Agent: Ask if the seller is open to backup offers.
- Submit a Strong Backup Offer: If the primary deal falls through, you will be next in line.
- Stay Updated on the Deal’s Status: Keep in touch with your agent to monitor any changes in the contract.
- Keep Exploring Other Options: Don’t rely solely on one property; keep looking at other listings.
Final Thoughts
Understanding “Active Under Contract” can help buyers and sellers navigate the real estate market more effectively. Buyers should know that these properties are still in play, while sellers can use this status to secure a deal while keeping backup options open. If you’re interested in a home with this status, working closely with a real estate professional is the best way to stay informed and prepared.
FAQs
1. What does “Active Under Contract” mean?
It means a home has an accepted offer, but the sale is not final yet. The seller may still accept backup offers.
2. Is “Active Under Contract” the same as “Pending”?
No, “Pending” means all conditions are met, and the deal is moving toward closing. “Active Under Contract” means the seller is still accepting backup offers.
3. Can I make an offer on a house that is “Active Under Contract”?
Yes! The seller can still consider backup offers in case the current deal falls through.
4. Why do sellers list a home as “Active Under Contract”?
It keeps their options open in case the current buyer backs out.
5. What happens if a backup offer is accepted?
If the first buyer cancels, the backup offer moves into first position.
6. Does “Active Under Contract” mean the house will definitely be sold?
Not necessarily. Deals can fall through due to financing, inspections, or other reasons.
7. How long does a home stay “Active Under Contract”?
It depends on the contract, but usually a few weeks to a couple of months.
8. Can the first buyer cancel the contract?
Yes, if they have a contingency (like financing or inspection issues).
9. Can the seller accept a higher offer?
Only if the first deal falls apart. Otherwise, the seller is legally bound to that contract.
10. Should I still look at homes listed as “Active Under Contract”?
Yes, especially if you’re open to making a backup offer.
11. Is “Active Under Contract” common in real estate?
Yes, especially in competitive markets where sellers want backup options.
12. How can I find homes that are “Active Under Contract”?
You can search on real estate websites like RedDoorMetro.
13. Does “Active Under Contract” affect financing?
Not really, but the first buyer’s financing situation could impact whether the deal closes.
14. Can a house go from “Active Under Contract” back to “Active”?
Yes, if the first deal falls through, the home could be relisted as “Active.”
15. What should I do if I want a home that’s “Active Under Contract”?
Talk to your agent about submitting a backup offer.
16. Is there a fee to submit a backup offer?
No, but you may need to provide earnest money if your offer is accepted later.
17. How often do “Active Under Contract” deals fall through?
It varies, but around 10-15% of deals don’t make it to closing.
18. Can I tour a home that is “Active Under Contract”?
Sometimes, but it depends on the seller’s preferences.
19. Should I wait for a home to fall out of contract or keep looking?
Keep looking! There’s no guarantee the first deal will fall through.
20. Where can I get more help with buying or selling a home?
Visit RedDoorMetro for expert real estate assistance.
