Most Commonly Used Contingencies In Washington Real Estate Contracts

Don't run away! I know the title of this post is confusing, and may not make much sense to some of you right now. But, we are going to tackle this topic together and make sense of it all today! Since buying a home is such a big and often final purchase, sometimes you can set up some ground rules for the process. You might want to set up certain conditions under which you will buy the home. "I will only buy this home if... it passes an inspection." Or "I will only buy this home if I can sell my current home within 90 days." These "conditions" or "rules" that you set are called contingencies. Today we are going to go over a few of the most common kinds of contingencies in Washington real estate contracts today.

Inspection Contingency

This is probably the most common contingency, and for good reason. Most sellers and buyers can mutually agree that the buyer be allowed at least one inspection prior to the purchase of the home. This is a good rule so that they buyer can back out of the deal without penalty if for some reason there is something found to be at fault with the home.

Financing Contingency

This is also a common one. Most every single home sale contract is contingent upon the buyer being able to secure the financing required to purchase the property. Usually contingencies of this nature give the buyer a period of time between signing and closing in which to secure the financing. You can set the contingency to specifically what type of financing or interest rate you are willing to accept. Of course, if you are paying cash for your property, you won't need to worry about this type of contingency.

Title Contingency

This particular contingency is very common and very important for the buyer. If the seller can not produce a title to the property, they can not legally sell it to you. Therefore, a contingency based upon production of a valid legal title can protect you from buying a house that you were never really allowed to buy. A title contingency can also clear up any issues with the title and make sure that you will be the full, complete and sole owner of the property. Make sure that a title report is a contingency in your home contract for sure.

The three contingencies listed above are by far the most common. However, there are hundreds if not thousands more contingencies that can be used in a real estate contract. There can be contingencies for termites and other pests, as well as for lead based paints. There are contingencies specifying what type of deed the seller must present at closing. Radon Testing and Mold Inspection contingencies are also frequently requested. There are tons of other contingencies, including sewer inspections, private well inspections, and homeowner's association contingencies. Insurance contingencies are also pretty commonplace these days. As you can see, the types of contingencies are many and varied. With a trusted real estate agent like Hamid Ali, you will be able to sift through all of these types and decide on whether or not you want a contingency included in your contract.