A real estate listing can tell you more about a property than just how many bedrooms and bathrooms it has. Certain terms on the listing can serve as red flags you may be buying into problems if you submit an offer on the home. Here are two real estate listing terms you should be wary of.
A listing that contains the words Lis Pendens is definitely one you need to take caution with. Lis Pendens is Latin for "a suit pending" and is essentially placed in the listing to notify the public the property is embroiled in a lawsuit, one that can have devastating repercussions for you if you purchase the home.
For instance, a common reason a home may be included in a lawsuit is there is a dispute over ownership, something that occurs frequently during divorces. If you buy the home and the lawsuit and the seller loses, you may be required to turn over the house to the winner and pursue the seller to get your money back.
As you can see, a Lis Pendens property can be hazardous to your financial health. However, it's important to note that not all properties with this listing are bad. Another reason a property may have a lawsuit notification is if the owner is in the midst of foreclosure. Banks and mortgage companies will often file a Lis Pendens against properties when they're in the process of repossessing the homes.
Therefore, if you're truly interested in a property, it's a good idea to uncover what the lawsuit is about to help you determine whether you should proceed or not.
Active with Contract
Another listing term you should be wary of is active with contract. This term means someone has already put an offer on the home but the seller is entertaining propositions from other buyers. You see this often with listings associated with properties in probate where owners are required to obtain the highest amount possible for the homes.
However, some sellers have contingencies in their contracts with potential buyers that leave them concerned the sales may not go through, so they keep their options open by seeking out backup buyers. For instance, the buyer may be waiting to sell his or her old home so he or she can have the money to purchase the new one. If sale of the old home doesn't go through by a certain date, the seller can move onto the next offer.
Homes listed as active with contract aren't necessarily bad, but you do need to be aware you'll only get the home if all the other buyers in front of you fail to follow through on their contracts. You can still make an offer but be prepared for disappointment.
For assistance with interpreting real estate listing terms or help finding your dream home, contact a real estate agent. You can also visit websites like http://www.leathermanhomes.com.