It is where a buyer has made an offer on a home, and the seller has accepted it, but the finalized sale is contingent upon specific criteria being met. These criteria, or contingencies, typically fall under four major categories: appraisal, loan approval, inspections and, reports and disclosures. The buyer has the time to do their due diligence in all of these areas.
In regards to inspections, in our area, the typical inspections are home inspection, roof and chimney inspection, termite inspection, and if your home has septic or well expect for inspections to be done on those as well. Depending on where you live, the buyer may want to have other inspections like mold, HVAC, soil, etc. It depends on what is customary due to problems or issues that typically arise in the area.
In regards to reports, those encompass full disclosure on both inside and outside of anything and everything to do with the home. Watch the disclosure video to see what you should disclose. In regards to reports, there are also title and escrow reports, State and local reports, and disclosures that the buyer has time to review during the contingency time frames. The contingency time frames are agreed upon in the initial contract and, in most cases, are around 7-17 days.
Still, in some cases, you can have a “no contingencies” if the buyer wrote an aggressive offer. In California, once you remove your contingencies, your deposit is at risk, so be sure not to remove them until you know you’re o.k. With all of the aspects of the home. You can ask for an extension if you need more time, and the seller would have to agree. The good news is that once all contingencies are removed, you have much more assurance that the home will close.
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