A contingency is anevent 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 is a contingency contract in real estate?
Because a real estate contract is a binding agreement, it is imperative for investors to understand contingencies, how they檙e used, and the many variations available. What Is A Contingency Contract In Real Estate? A contingency contract in real estate is a conditional purchase agreement with stipulations that must be met to complete the sale.
Are all contingent offers a contingency?
Not all contingent offers are marked as a contingency in the real estate listing. For example, purchases made with a mortgage generally have a financing contingency. Obviously, the buyer cannot purchase the property without a mortgage.
What is a contingency clause?
If the buyer is having trouble getting a mortgage, or the property appraisal is too low, or there some other problem with getting a mortgage, a contingency clause means that the contract can be broken with no penalty or loss of earnest money to the buyer or seller.
What is a contingency in a short sale?
If it a real estate short sale, meaning the lender must accept a lesser amount than the mortgage on the home, a contingency could mean that the buyer and seller are waiting for approval of the price and sale terms from the investor or lender.