Waiving contingencies

          If you happen to be buying a home in a hot real estate market, such as Seattle, WA, you might feel a little pressure to cave when it comes to winning over a seller that is looking to get the best deal for his or her bottom line. This might lead you to think about compromising some of your contingencies. Not sure what they are? Typically, buyers establish contingencies that let the seller know a the deal could be called off at anytime if everything doesn't check out to be as advertised or as agreed upon. This of course providers a buyer with more power during the sale, allowing them to make deals and haggle bargains that benefit them.

            However, all bets seem to be off when dealing with a seller in a highly competitive market. Waiving contingencies may appear to disadvantage a buyer, but this isn't necessarily true. As a matter of fact, some buyers in hot markets are waiving their contingencies to get an advantage during the home buying process.

            On the other hand, there are some contingencies that should be carefully considered before making any big moves. Waiving these contingencies could put you at risks you never thought of. Since contingencies vary depending on a situation and the market, here is a look at some of the ones that home buyers should put at the very bottom of their waiver list.

Earlier Move-In Dates

If you have ever had part in a real estate deal, you may already know that things can take time. This is why many home buyers make a request to move their belongings into the home if for some reason the closing is delayed. While this contingency is convenient for the buyer, most sellers feel inconvenienced by it because there are too many unknowns in these type of situations. Moving in early and then having to work out the final kinks could also put the buyer in a bind because the seller knows how much you want to quickly close on the home. After all, you already moved in!

Homeowners Associations

Some buyers are wary of what lies in the details of contracts with homeowners associations, which is why they ask for a homeowners association contingency. Basically, this covers you in case you realize that the rules don't fit your lifestyle. It's just best to do your homework before making any deals to ensure you are looking in a neighborhood that will allow you and your family to maintain your lifestyle. If you have no specific concerns and no problem complying with the rules, waiving this contingency might be a good idea.

Financing

A financing contingency protects the buyer in the instance his or her financing falls through. For obvious reasons, waiving this contingency could lead to lots of problems. First of all, you'll likely look your earnest money. Second, you might be forced to pay all kinds of fees if you are not protected. Nonetheless, if a buyer is financially stable or if he or she has a padded savings account, waiving this contingency might be appealing to him or her.

 Appraisals

Chances are your lender will require an appraisal before letting you proceed with the deal, but in some cases, you might be able to waive this contingency. Just keep in mind that waiving this contingency is not necessarily recommended because appraisals are what provide you with an assessment of the home's value. If you don't have an appraisal performed, you might end up overpaying or settling for a deal that will leave you in high water.

Home Inspections

There are plenty of reasons why you would want to have the property inspected before agreeing to buy, which is why the majority of buyers insist of including a home inspection contingency when negotiating a real estate deal. You can opt to waive this contingency but do so at your own peril. You'll be waiving the right to have the home inspected, so who knows what little (or big) secrets you'll discover after moving in or living in the home for a couple of years. Do yourself a a favor and make sure you have a professional home inspector take a look at the property before you commit. If a seller is persistent that the contingency should be waived, this should be a huge warning sign.

 Title Inspections

If asked to waive your contingency regarding a title inspection, your instincts should kick in and tell you to get out of the deal while you can. There are a range of marks that can be made against a title and you won't know about them unless you have them investigated by a title inspector. A title search will let you know who currently owns the home, who has owned the home in the past and if there are any liens on the property that you should be aware of. At all costs, this contingency should never be waived. Why? Well, because you could wind up owning a home with a title that is riddled with liens. These liens will then become your responsibility, leaving you in a financial bind you never saw coming.

             Waiving contingencies in certain markets could potentially give buyers an edge, but there are just some that should never be touched. If you are planning to purchase a piece of property in a booming market, such as Seattle, it's recommended you discuss contingencies with your realtor before beginning the search for a new home. He or she should be able to facilitate you with loads of helpful information regarding contingencies and the level of risk associated with the waiving of each one. Once you know how waiving contingencies might affect you as a buyer, you will be more inclined to either stand your ground on important matters or strike while the market is hot in order to get an amazing deal. As always, it's best to consult with a professional that deals with these type of situations on a daily basis.

 

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