FAQ: What Are Contingencies in Real Estate Contracts?
Contingencies are conditions that must be met for a real estate contract to move forward. They protect both the buyer and seller by allowing either party to cancel or renegotiate the deal if certain requirements aren’t satisfied.
Common contingencies include:
🏠 Home Inspection Contingency: Allows the buyer to back out or request repairs if the inspection reveals major issues.
💰 Financing (Loan) Contingency: Ensures the buyer can secure a mortgage before finalizing the purchase.
📈 Appraisal Contingency: Protects the buyer if the home appraises for less than the agreed purchase price.
🧾 Title Contingency: Gives the buyer the right to review the property’s title to confirm there are no ownership disputes or liens.
🔁 Home Sale Contingency: Allows the buyer to make the purchase dependent on selling their current home first.
These contingencies help balance risk and give both parties peace of mind during the transaction process.
◾ Rhonda Alderman
◾ Broker Associate-Keller Williams Realty
◾ DRE#01292529
