What is a Contingency

Home sales can be complex agreements that involve multiple contingencies. But what is a contingency, and how does it impact a potential sale? Here’s what you should know.

What are they? In any sense, the word “contingency” essentially means “depending on certain circumstances.” In the real estate industry, when a house is listed as contingent, it means an offer​​​​​​​has been made and accepted, but some additional criteria must be met before the deal is complete.

What are some examples? Financing contingencies are some of the most common real estate contingencies. There can be other contingencies relating to inspections, appraisals, tests for termites, potential toxins and more. There can also be contingencies for deeds, titles and HOA rules. Whatever the case, these stipulations in a contract usually work to a buyer’s advantage by letting them out of a contract when stated contingencies aren’t met.

Getting assistance. Sellers generally aren’t fond of contingencies because they tend to give buyers extra opportunities to renege on a home purchase. Whether you’re buying or selling a home, it helps to get assistance from a local real estate agent who can help you create or manage contingencies to help streamline the home selling or buying process.

Feel free to reach out with any questions. I’m here to assist you every step of the way!