Contingencies


In most purchase transactions there may be a slight challenge or two, but most things will go quite smoothly. However, you want to anticipate potential problems so that if something does go wrong, you can cancel the contract without penalty. These are called "contingencies" and you must be sure to include them when you offer to buy a home.

Many contingencies are already outlines in the standard Residential Resale Real Estate Purchase Contract accepted and distributed by the local Association of Realtors. Such things as Qualifying for the loan, Home Inspections and Appraisals are already covered. But what if you needed to sell your current home or if the home was in a floor plain? You would want a contingency that allowed you out of the contract if your house doesn't sell or if the floor insurance priced you out of home.

Basically, contingencies protect you in case you cannot perform or choose not to perform on a promise to buy a home. If you cancel a contract without having built-in conditions and contingencies, you could find yourself forfeiting your earnest money deposit. or worse.

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