Buying a home is stressful enough, but when you’re trying to purchase a new place while still owning your current one, the process becomes even more complex. That’s where a contingent mortgage pre‑approval comes in.
This type of pre‑approval can protect you financially, but it can also weaken your offer in competitive markets like Seattle, Portland, and San Francisco. Understanding how contingent pre‑approvals work, when they make sense, and how to structure a purchase without one can be the difference between winning and losing a home.
A contingent mortgage pre‑approval is a preliminary mortgage approval that is conditional upon one key event: the sale of your current home.
Unlike a standard pre‑approval (where the mortgage lender verifies your income, assets, credit, and debts), this version includes an additional requirement: Your existing home must sell before the lender will finalize or fund your new mortgage.
This happens when:
Until your home sells, the lender considers your financial picture incomplete. That’s why the pre‑approval remains “contingent.”
A contingent pre‑approval still shows sellers you’re serious, but it’s not as strong as a fully underwritten, non‑contingent pre‑approval.
A typical contingent pre‑approval includes:
Once your home sells and the proceeds are documented, the lender removes the contingency and converts your pre‑approval into a fully verified approval.
A home sale contingency is a clause in a purchase contract that says your offer is only valid if your current home sells within a specific timeframe.
Buyers use this when they need the equity from their existing home to fund the down payment or qualify for the new mortgage.
The purpose is simple: it protects you from ending up with two mortgages at once. If your home does not sell in time, the contingency allows you to back out of the deal without losing your earnest money deposit.
Most home sale contingencies run for 30 to 60 days, though the exact timeline depends on the agreement. Contracts often include details like whether your home must already be listed, how quickly you must accept an offer, and whether the seller can invoke a “kick‑out clause”, meaning they can accept another offer if it comes along.
When you make a contingent offer, you’re essentially telling the seller: I want to buy your home, but I need to sell mine first. The process usually unfolds in a predictable sequence:
Sellers evaluate contingent offers carefully. They look at whether your home is already listed, how competitively it’s priced, how quickly homes sell in your area, and whether there are other buyers making non‑contingent offers.
If your home isn’t even on the market yet, your chances drop significantly.
Consider the benefits and potential drawbacks of a contingent mortgage pre-approval:
Pros:
Cons:
Sellers prefer clean, fast, low‑risk deals. Contingent offers introduce:
In hot markets, contingent offers are often dismissed immediately unless the home has been sitting for a long time.
Here’s a clear comparison of how contingent and non-contingent offers stack up:
| Feature | Contingent Offer | Non-Contingent Offer |
| Risk to Seller | High | Low |
| Timeline | Longer | Faster |
| Likelihood of Acceptance | Lower | Higher |
| Buyer Financial Risk | Lower | Higher |
| Competitiveness | Weak | Strong |
| Earnest Money Risk | Protected | Higher risk |
| Appeal in Multiple Offers | Low | Very high |
A non‑contingent offer is almost always stronger because it removes the biggest unknown: whether your home will sell.
If you want your offer to stand out, the best strategy is to avoid a contingency altogether. Fortunately, there are several ways to do that.
One option is the sell‑first strategy. You sell your current home before shopping for your next one. This gives you a clean, non‑contingent offer and eliminates the risk of carrying two mortgages.
The trade‑off is that you may need temporary housing while you search for your new place.
Another option is a bridge loan, which is a short‑term loan that lets you tap into your home’s equity before it sells. This gives you the money needed for a down payment without having to wait for your sale to close.
A growing alternative is Buy Before You Sell programs, which have become extremely popular.
These programs allow you to unlock your equity upfront or even purchase the home on your behalf, enabling you to make a strong, non‑contingent offer. Once you move into your new home, your old one is listed and sold, often for a higher price because you’re not rushed.
Some buyers also use savings, investments, or a HELOC (Home Equity Line of Credit) to bridge the gap. If you have enough equity, a HELOC can provide the down payment you need without requiring a contingency.
Even though they’re not ideal, contingent mortgages aren’t always bad. They can work well when:
If you do need to make a contingent offer, there are ways to improve your chances.
Lenders don’t love uncertainty either. Here’s how they evaluate contingent mortgages:
Until your home sells, your DTI includes:
This can make approval harder.
Lenders see contingent mortgages as higher risk because your ability to repay depends on selling your home.
You may face:
Expect to provide:
Buying a home while selling another can feel complicated, but understanding contingent mortgage pre‑approvals gives you a clearer path forward. Once you know your options, you can choose the approach that fits your timing, finances, and comfort level, and make a stronger, more competitive offer.
Are you looking to purchase a home in the Pacific Northwest? If so, Sammamish Mortgage can help. We assist borrowers across Washington, Idaho, Colorado, Oregon, and California. Since 1992, we’ve offered several mortgage programs with flexible qualification criteria to borrowers, including our Diamond Homebuyer Program, Cash Buyer Program, and Bridge Loans. Visit our website to get an instant rate quote or to use our online mortgage calculator. Or, contact us if you’re ready to get pre-approved for a mortgage.
A mortgage approval that depends on selling your current home first.
A contingent mortgage is a loan that can only close after your current home sells, while a contingent mortgage pre‑approval is a preliminary approval that’s also dependent on that sale but issued before you make an offer.
It means the sale is conditional on something happening, usually your home selling.
Yes, though lenders may require more documentation and stricter underwriting.
Typically 30 to 60 days.
They’re faster, cleaner, and less risky.
Yes, but only if both parties agree in writing.
Your contract may be canceled, and you may lose the home.
No, they’re often rejected immediately.
Bridge loans, Buy Before You Sell programs, HELOCs, or selling first.
Contingent means conditions still need to be met; pending means all conditions are satisfied.
Yes, but it doesn’t guarantee the seller will accept it.
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