What Does It Mean When a House Is Under Contract? Understanding Real Estate Statuses

When a seller accepts an offer, the property moves into an under contract phase. This means a purchase agreement is signed and the home is formally reserved for that buyer, although conditions may still be in play. ‍ Understanding the differences between under contract, contingent, and pending is essential for buyers and sellers navigating the home sale journey.

“Under Contract” vs “Pending” vs “Contingent”

Under Contract

• What It Means: The seller has accepted an offer, and both parties have signed a purchase agreement. However, contingencies such as financing, inspections, or appraisals may still be outstanding.
• What It Implies: The home is not fully sold yet; backup offers may still be accepted depending on local MLS rules and listing status.

Contingent

• What It Means: A contract exists, but one or more conditions must be met (e.g. financing, home sale, inspection). If contingencies fail, the buyer can walk away without penalty.

Pending

• What It Means: All contingencies are satisfied, and the closing process is underway. The property is generally removed from marketing, though rare exceptions like backup offers may still apply.

What Happens During the Under Contract Phase?

During this stage, several critical steps must be completed:

• Contingency Period: The buyer conducts home inspections, appraisals, financing approvals, and negotiates repairs or concessions. Deal may fall through if the terms aren’t met.
• Financing Approval: Loan underwriting and appraisal must be finalized before closing. If financing fails, the contract may be voided.
• Title Search & HOA Review: Ensures there are no title issues; HOA-related approvals may be required.
• Final Walkthrough & Closing Prep: Buyer verifies repairs and final condition; closing documents are signed and funds exchanged.

Can Offers Still Be Accepted When Under Contract?

Yes, active under contract status indicates the seller may still accept backup offers while satisfying contingencies. Sellers often use this status to keep options open if the current deal falls through.

Once a property transitions to pending, backup offers are seldom entertained as closing nears.

Sale Completion Odds & Buyer Strategies

• Real estate deals under contract still carry approximately a 5–7% risk of termination, due to contingencies failing or financing/appraisal issues.
• Buyers may submit backup offers (especially on active under-contract listings) as an opportunity if the original deal collapses.

Summary Table: Status Comparison

Sources: “Under Contract vs Pending” by Navy Federal and PandaDoc.

FAQs

Q: What does “active under contract” mean?
A: It means the deal is underway, but the seller may still show the home and accept backup offers. It’s less advanced than pending status.

Q: When can a contract fall through?
A: Even under contract, buyer contingencies might fail, inspection issues, appraisals, or financing can delay or cancel the sale.

Q: Is pending always final?
A: Not yet, pending is very close to closing, but issues like financing delays or title problems could still derail the process.

Bottom Line

When a home is under contract, it means an offer has been accepted and documented, but contingencies may still be unresolved. Only once those conditions are satisfied does a property reach pending status, signaling an imminent sale. Understanding these stages empowers buyers to evaluate backup opportunities and helps sellers gauge interest while expectations remain clear.

Written by Vanessa Gallanti. July 29, 2025

Enthusiast about planning, project management, construction materials and technology, and construction. A civil engineer from Los Andes University and a content writer for Kukun.