If you are about to make an offer on a home, a contingency offer can protect you in several ways. Read on and learn more about contingencies and what they mean.
What Is a Contingency Offer?
Along with an offer to buy a home at a certain price, your offer will probably also include contingencies. A contingency is a clause in the sales contract that allows buyers to get out of the contract if the contingencies are not met. Contingencies must be included in the initial offer because once the seller agrees to both the price and the contingencies, they become part of the legal contract to buy the home. Here are some common contingencies:
In most cases, sellers should aim for fewer contingencies rather than more. Keep in mind that the seller could accept another buyer's offer, even for less money, if the contingencies are too much to deal with. Buyers unsure about how to balance protecting their interests with gaining acceptance of an offer should consult with a real estate agent about what is and what is not okay when it comes to contingencies. In extremely competitive markets, only the bare minimum of contingencies that are required by the lender should be used. To learn more about contingencies, make an appointment with a residential real estate company.