Pending. Under Contract. Active/Backup.
In real estate, what do these terms mean?
When Realtors® sell a Fort Collins home, or a Greeley home, or Loveland real estate, or any transaction that happens in the great and colorful state of Colorado, there is the phase between when the offer on the home is accepted and the closing day, when the transaction is completed.
Those phases, though they are all similar in what happens throughout, are often listed with different statuses on the Multiple Listing Service (MLS) and other websites, like Realtor.com.
In the video above, I am placing a “CONTRACT PENDING” sign on my listing. That is to let drivers-by know that this property was for sale, but we have accepted an offer and are on our way to the closing table.
‘Contract Pending; and ‘Under Contract’ are two different ways of saying the same thing. This property is on its way to the hands of a new owner, so it is no longer available for viewings, or offers.
There is a due diligence period between when an offer is accepted and when the new owner commits fully to it and takes possession. Once it is under contract, the deal is not done, but in many ways, that buyer and seller are committed to each other. ‘Contract Pending; and ‘Under Contract’ are basically saying “This property has not yet changed hands, but if events follow a certain course, it will.” There really isn’t too much of a reason to make an offer or consider that property with too much seriousness, because it’s almost off the market. It’s like being engaged to be married.
‘Active/Backup’ is another story. It is used in the case when an offer is accepted, but perhaps there are signs that the deal isn’t ironclad. In order to take care of the sellers, the listing agent is staying open to other offers. Again, making a lot of offers on ‘Active/Backup’ properties might not yield very much except a lot of work for your Realtor® to do.
In these cases, if something that must be yours is in ‘Active/Backup’ status, have your Realtor® call the listing agent to see how the deal is going, and if they are still accepting backup offers.
In a market this tight, it could be helpful for your Realtor® to establish a relationship with the other Realtor®, because if something does go bad in the dead of night, they are going to want to find another deal for their client…ASAP.
‘Active/Backup, Under Contract, and Contract Pending’ are among our favorite signs to hang. However, there is one that we like even better, featured in the video below.