Contingencies

In real estate, a contingency is a condition that must be met before a sale can be completed. Contingencies are typically included in the Buy-Sell Agreement and are designed to protect the interests of both the buyer and the seller.

There are several types of contingencies that may be included in a real estate contract, including:

Financing contingency: This contingency requires the buyer to obtain financing before the sale can be completed. If the buyer is unable to obtain financing, they may be able to cancel the contract and receive a refund of any deposits they have made.

Appraisal contingency: This contingency requires the property to appraise at or above the purchase price before the sale can be completed. If the property does not appraise at or above the purchase price, the buyer may be able to renegotiate the purchase price or cancel the contract.

Inspection contingency: This contingency requires the buyer to have the property inspected before the sale can be completed. If the inspection reveals any issues with the property, the buyer may be able to negotiate for the seller to make repairs or may be able to cancel the contract.

Title contingency: This contingency requires that the seller provide a clear and marketable title to the property before the sale can be completed. If there are any issues with the title, the buyer may be able to negotiate for the seller to resolve them or may be able to cancel the contract.

Home Sale Contingency: A home sale contingency in real estate is a condition that requires the sale of the buyer’s current home to be completed before the purchase of a new home can be finalized.

Contingencies are an important part of a real estate transaction, as they help protect the interests of both the buyer and the seller and ensure that the transaction is completed smoothly.