Sometimes a buyer needs to sell a house prior to buying another. I should say most of the time because most people (but not all) cannot qualify and afford carrying two houses at once. Makes sense, doesn’t it? And often that same buyer is so excited about their new adventure of moving, they find a new house they LOVE prior to selling theirs.
What’s a buyer to do… ? What’s an agent to do? The buyer can write an offer on the new house “subject” to the sale of their current house. The California Association of Realtors has a form “COP” to do so.
But why would a Seller accept an offer with a long, doubtful contingency and tie up their property in an escrow that is so uncertain? They might if they are desperate but even then, they most often reject this kind of offer (especially if they have a smart listing agent).
So what’s the buyer to do? The solution lies in the form COP (contingency on the sale of another property). The buyer/seller’s best solution is to get their house on the market before falling in love with a new house, pricing it very aggressively (review your market analysis with their agent and price on the low side for immediate offers), doing a pre-inspection and repairing safety items, making sure your agent has a strong marketing plan, and going into escrow quickly. Because you’ve done the pre-repairs the buyer/seller can shorten the inspection contingency and the moment your buyer removes their inspection contingency and you are strongly certain about your loan, write an offer on the new house you love.
The COP allows you to present a strong offer with a short contingency for the sale of your current property and makes you a much more attractive buyer. It can be done. I’ve seen it happened and with an up-swinging busy market this Spring 2016, it is a great solution.
