Most move-up buyers in Wyoming face the same problem. They want to buy their next home, but they need the money from their current sale to do it. Or they cannot carry two mortgage payments at once. Or both.
The tool built for this situation is a home sale contingency. It is one of the most important things to understand if you are buying and selling at the same time, and most buyers do not really understand how it works until they are in the middle of a transaction and the other side is pushing back on it.
Here is what you need to know before you write an offer with a contingency.
What a home sale contingency actually is
A home sale contingency is a clause in a purchase agreement that says: the buyer's obligation to purchase this home depends on their current home selling first. If their home does not sell by a specific date, the buyer can walk away from the deal without losing their earnest money.
There are two versions of this contingency that buyers typically use:
- Sale contingency: your current home must go under contract before you are obligated to close on the new purchase. You have not listed yet, or the home is listed but does not yet have a buyer.
- Settlement contingency: your current home is already under contract, but you need it to actually close before you can close on the purchase. This is less risky for sellers to accept because the timeline is more predictable.
The distinction matters. A sale contingency asks the seller to wait while you go find a buyer for your current home. A settlement contingency asks the seller to wait while an existing transaction closes. Sellers in competitive situations will sometimes tolerate the second one and say no to the first.
When to use a contingency offer
Contingency offers work best when: the home you want has been on the market long enough that the seller has reason to consider it; your current home is strong and ready to list so the contingency window is short; or the local market conditions mean sellers have fewer clean offers coming in.
In Casper and across Wyoming, inventory levels and pace of activity shift by neighborhood and by season. I look at the specific home and specific market before recommending a contingency offer. Sometimes it is the right move. Sometimes it is the offer that gets passed over in favor of a cleaner offer from someone without one.
Read more about coordinating a sale and a purchase in how to buy and sell a home at the same time in Wyoming.
The kick-out clause: what it means for you
When a seller accepts a contingency offer, they often attach a kick-out clause. This allows the seller to keep marketing the home. If they receive another offer they want to accept, they give the contingency buyer a short window, typically 24 to 72 hours, to either remove the contingency and proceed, or step aside so the seller can take the new offer.
Understanding this before you write the offer is important. A kick-out clause means your deal is not locked until either your contingency is removed because your home sold, or the kick-out window expires without another offer coming in.
If you get a kick-out notice and your home has not sold yet, you have a real decision to make. Can you qualify to buy without selling first? If yes, you may be able to remove the contingency and proceed. If not, you may need to let the home go and keep looking.
How to make your contingency offer as strong as possible
A contingency offer does not have to be a weak offer. There are things you can do to make it more attractive to a seller:
- Keep the contingency period short. If your current home is priced right and ready to list, put a 30-day window in the offer. A short, well-defined window is easier for a seller to accept than an open-ended one.
- List your home before you write the offer. Having your home actively on the market shows the seller you are serious and gives them more confidence in your timeline.
- Come in close on price. A contingency offer at or near asking price is harder to say no to than one that discounts the price on top of the contingency.
- Show your financing. A strong pre-approval letter from a Wyoming lender tells the seller that once your home closes, your purchase closes with it.
When a contingency is not the right answer
Sometimes the right path is to sell first and buy after. It is less convenient because you may need to arrange temporary housing between closings, but it removes the contingency entirely and puts you in a stronger position as a buyer. I walk through this choice in detail in sell first or buy first in Wyoming.
Another option is bridge financing, which lets some buyers purchase before they sell by using the equity in their current home as short-term collateral. Not every buyer qualifies, but if you do, it can give you the ability to write a clean offer with no contingency. A local lender can tell you if this is available to you. Read more about avoiding two payments in how to avoid two house payments when moving up in Casper.
How I handle contingency transactions for my buyers
When I am representing a buyer on a contingency offer, a few things matter. I price your current home honestly so the contingency period is as short as possible. I write the contingency terms clearly so there is no ambiguity about what triggers removal. I communicate frequently with the listing agent so the seller's side knows the transaction is moving forward.
And when a kick-out notice comes, if it comes, I am there to help you work through the decision in the window you have. The decision is yours. My job is to make sure you have the information to make it clearly and without panic.
Most agents handle transactions. I handle transitions. If you are in a move-up situation in Wyoming and you want to talk through the contingency approach, reach out.