If you have never sold a home before, there might be a lot of steps in the process that you might not fully understand. One thing that could happen when selling your house is receiving an offer that contains contingencies. Here is an explanation of what contingencies are and what you should know about them.
The basic principle of a contingency
A contingency is a common part of a real estate contract, and it basically states a condition the buyer is asking the seller to meet. If the seller agrees to meet the condition, the buyer can accept the offer and must follow through with meeting it. If the seller does not agree to it, the seller can counter offer the contingency or deny accepting the offer.
It is not uncommon for a real estate offer to have multiple contingencies on it. As the seller of a house, you must read through the contract very carefully to make sure you fully understand the contingencies, and you should not sign the offer unless you agree to all of the stated conditions.
Common types of contingencies
There are several common types of contingencies you should expect to see on the offer a person writes you, but there can be other contingencies that are not common. An example of a common contingency is a financing one. In this example, the contingency would state something to the effect of the deal is subject to the buyer getting approved for a mortgage. This is something you would expect to see on a real estate offer, as the buyer could not buy your house without a loan.
Other common ones can include that the buyer has the right to an inspection of the house and the title work comes back with a clear, clean title.
In some cases, buyers will include other types of contingencies, though, such as a contingency to sell a house. In this case, the deal would only go through if the buyer sells his or her current home first.
Considerations when accepting an offer that contains contingencies
Before you an accept any offer, make sure you read it carefully and consider the impacts of the contingency. If you need additional help understanding the contingencies, talk to your agent so that you can fully understand what you are signing.
If you plan on selling your house soon, you will probably receive an offer that contains contingencies. To learn more about contingencies and other parts of the process of selling your house, contact a real estate agent today.