Short Answer
Contingencies are conditions that must be met for the sale to proceed. Common contingencies include home inspection, financing, and appraisal. Evaluate each contingency carefully. A financing contingency protects the buyer if their loan falls through but can delay the sale. An inspection contingency gives the buyer the right to negotiate repairs. An appraisal contingency protects the buyer if the home appraises for less than the offer price. Consider the buyer's financial strength and the likelihood of the contingencies being satisfied. Your agent will help you evaluate offers and negotiate terms that protect your interests.
When you receive an offer with contingencies, you need to evaluate the risk and the terms. The most common contingencies are the financing contingency, which allows the buyer to back out if they cannot obtain a mortgage; the inspection contingency, which allows the buyer to negotiate repairs or cancel based on inspection findings; and the appraisal contingency, which allows the buyer to cancel if the home appraises for less than the offer price. Less common contingencies include the home sale contingency, which allows the buyer to cancel if they cannot sell their current home, and the attorney review contingency, which is standard in New Jersey. An offer with fewer contingencies is generally stronger because it presents less risk of the deal falling through. However, a well-qualified buyer with reasonable contingencies can still be a solid offer. Your agent will help you evaluate the buyer's financial qualifications, the likelihood of the contingencies being satisfied, and the overall strength of the offer. You can also negotiate to shorten contingency timeframes or limit the scope of certain contingencies.
Bob's Advice
Redfin Senior Agent · AI Certified Agent
Contingencies are a normal part of real estate transactions. I will help you evaluate each offer and understand the risks. A buyer with a strong pre-approval and a reasonable inspection contingency is generally a safe bet. A buyer with a home sale contingency and a low down payment presents more risk. I will help you weigh the offers and choose the one that gives you the best combination of price and certainty. If you have concerns about specific contingencies, we can negotiate tighter terms to protect your interests.
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