What Is the Difference between Sold and Sold Subject to Contract

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If you`re in the process of selling or buying a property, you may have come across the terms “sold” and “sold subject to contract.” While both terms may initially sound similar, they actually have very different meanings. In this article, we`ll explain the difference between the two, and what they mean for buyers and sellers.

Sold

When a property is “sold,” this means that the seller has accepted an offer from a buyer, and both parties have exchanged contracts. This is a legally binding agreement, which outlines the terms of the sale, including the purchase price, deposit amount, and completion date.

At this point, the property is no longer available for sale, and the seller cannot accept any further offers from other potential buyers. The sale is considered “complete” once both parties have fulfilled their obligations under the contract, including payment of the purchase price and transfer of ownership.

Sold subject to contract

On the other hand, “sold subject to contract” means that the seller has accepted an offer from a buyer, but the sale has not yet been completed. This means that all aspects of the contract have not yet been agreed upon, and certain conditions still need to be met before the sale can be finalized.

During this time, the property is still technically available for sale, and other potential buyers may still make offers. However, the seller must inform any potential buyers that the property is “sold subject to contract,” and that they have accepted an offer from another buyer.

Typically, “sold subject to contract” means that the buyer has not yet paid the deposit, and the completion date has not yet been set. This gives both parties time to finalize the details of the sale, including any necessary surveys, searches, or financing arrangements.

Once all the conditions have been met, and both parties have exchanged contracts, the sale is considered “complete,” and the property is no longer available for sale.

So, what`s the difference?

The key difference between “sold” and “sold subject to contract” is the level of certainty in the sale. A property that is “sold” has already exchanged contracts, and both parties are legally bound to fulfill the terms of the agreement. On the other hand, a property that is “sold subject to contract” is still in the process of being sold, and certain conditions still need to be met before the sale can be finalized.

For buyers, it`s important to understand the difference between the two terms, as it can impact your ability to make an offer on a property. If a property is “sold,” it`s no longer available for sale, and any offers you make will be rejected. However, if a property is “sold subject to contract,” you may still be able to make an offer, although your offer will be considered a backup offer.

For sellers, it`s important to communicate clearly with potential buyers about the status of the sale. If your property is “sold subject to contract,” you must inform any other potential buyers that you have already accepted an offer. Failure to do so could result in legal issues down the line.

In conclusion, the difference between “sold” and “sold subject to contract” is an important one for both buyers and sellers. Understanding these terms can help ensure a smoother and more successful property sale, with no surprises along the way.