What is a contingency in real estate? A contingency is an event or condition that must occur before the deal can close. Typically,a buyer will reserve the right to recover her earnest money if the contingency is not satisfied.
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What are contingencies in a real estate contract?
It’s normal for a number of contingencies to appear in most real estate contracts and transactions. Either the seller or the buyer can propose a condition on just about anything; it’s all part of the bargaining back-and-forth.
What is a financing contingency?
Financing contingency: If a buyer needs a mortgage loan to buy the home, the buyer will typically include a financing contingency that allows the buyer to terminate the deal if the loan is not approved via a loan commitment letter by a certain date.
What does it mean when a house is listed as contingent?
In real estate, when a house is listed as contingent, it means that an offer has been made and accepted, but before the deal is complete, some additional criteria must be met.
What is a contingency clause?
Think of a contingency as an escape clause. Think of it as an escape clause that can be used under defined circumstances. It’s also sometimes known as a condition. A typical contingency clause might read like this: This contract is contingent upon Buyer successfully obtaining a mortgage loan at an interest rate of 6 percent or less..