If you’re currently in the middle of shopping for a new home, you may come across houses that have a contingent offer status. Contingent offers are pretty standard these days, and they mean that an offer has been made on a home and accepted by the seller, but the final sale is contingent on certain criteria that need to be met. These contingencies usually fall under three main categories: home inspection, appraisal and mortgage approval. Contingencies are mainly put in place so that the buyer can back out of the sale without losing their deposit in case something goes wrong. Sellers may entertain other offers while a contingent offer is in sale, but will not deal with other buyers until the contingent offer is finished one way or another.
1. A home inspection contingency is one of the most, if not THE most, important ones. It gives buyers the right to have a home inspected professionally. If something wrong is found, buyers can request to have it fixed, or they can back of out the sale altogether.
2. An appraisal contingency allows for a third party hired by the lender to evaluate the fair-market value of a home. If the appraised value comes to less than the sale price, an appraisal contingency will let the buyer back out of the sale.
3. A mortgage contingency protects both the buyer and the seller from entering a sale without a proper loan. The buyer will be given a specified time period to obtain a loan that will cover the mortgage. If they fail to get a lender to commit to a loan, they have the right to back out of the sale without losing the down payment.
If you are planning to buy a home, let The Incorvaia Team make the process as easy as possible for you. Call us at 440-879-7130 today!
