Common contingencies used when buying a home

On Behalf of | Dec 7, 2022 | residential real estate | 0 comments

Sometimes, certain conditions have to come to fruition for you to be able to purchase a Florida home. Known as real estate “contingencies,” these clauses in a real estate contract essentially allow you to back out of a deal if certain circumstances never come to be.

According to NerdWallet, some real estate contingencies come up more often than others, and all of them help protect your interests ahead of a major investment. Some of the most common contingencies in residential real estate appear below.

Home sale contingencies

You may put a conditional offer down on a home, stating that you plan to buy it as long as the home you currently own sells first. This type of contingency usually applies for a set amount of time. For example, you may have between 30 and 60 days to sell your home before you forfeit the existing contract.

Home inspection contingencies

A home inspection contingency gives you a chance to back out of buying a particular property if a home inspection reveals that it has major defects. A home inspection contingency may also pave the way for you to renegotiate a home price if you wind up having to fix serious problems within it.

Mortgage contingencies

Mortgage contingencies give you an out if you are unable to secure a loan for the property you hope to buy. You typically need this type of contingency even if you receive preapproval for a loan because preapproval is just that and not an absolute.

These are some of the most common contingencies used when buying real estate. However, it is not a comprehensive list of all contingencies that may come into play.