4 Most Common Types of Contingencies When Buying a Home

4 Most Common Types of Contingencies When Buying a Home

Question: What are the Most Common Types of Contingencies when Buying a Home?

Answer: When buying a home it is not uncommon for homebuyers to include a contingency or contingencies in their offer, but before we discuss the most common types of contingencies let’s define what a contingency is.

4 Most Common Types of Contingencies When Buying a Home

So What Exactly is a Contingency?

A contingency is a type of clause added to a real estate contract that protects the buyer. It allows them a certain amount of time to “clear” their contingencies and if they are unable to do so within the given period of time they can usually cancel the contract without penalty, but it will ultimately depend on how the contract was written.

So What Are the Most Common Types of Home Buying Contingencies?

Below I’ve listed the most common types of contingencies I’ve come across as a Realtor when working with buyers and sellers.

#4 Sale of Existing Home:

Sale of existing home contingency means the buyer must sell their current home before they can purchase a new home and if they are unable to do so within the contingency period they can cancel the contract. While this type of contingency used to be very common I personally haven’t had a seller accept this type of contingency in over a decade.

What are the Biggest Home Buying Contingencies?#3 Appraisal:

An appraisal contingency means the home must appraise for the contracted purchase price and if it doesn’t appraise within the contingency period the buyer can cancel the contract. However, in some cases, a buyer won’t be able to obtain financing if the home doesn’t appraise, so some buyers forego adding an appraisal contingency. Going this route needs to be discussed with the mortgage lender and the buyer needs to understand the risk of not adding this contingency.

Also, just because a home doesn’t appraise it doesn’t necessarily mean the contract needs to be canceled. There are several possible outcomes when a home doesn’t appraise and those options can be explored @ “What Happens if the Home I’m Purchasing Doesn’t Appraise?”

#2 Financing:

A financing contingency means the buyer must be approved for a mortgage within the contingency period, which is usually 21-30 days and if they are unable to do so can cancel the contract. In Wellington Florida, the real estate market I cover, nearly 50% of home buyers need to obtain a mortgage. However, in order to purchase a home not all buyers will include this type of contingency. This is not something I recommend, but I have had several home buyers remove their finance contingency in order to compete with cash buyers and/or have their offer accepted.

#1 Home Inspection:

The number one real estate contingency almost every single buyer adds to their offer is a home inspection contingency. This type of contingency allows the buyer to perform an inspection within the contingency period, which is usually within 5-10 days of the effective date. However, unlike a lot of other contingencies a home inspection contingency doesn’t necessarily mean the buyer can cancel the contract, it will depend on the contract and addendums used. A home inspection is something I always recommend regardless if the home is brand new or looks well maintained.

So How Many Contingencies Do Most Buyers Have?

This answer varies, sometimes zero and sometimes 3-4, it all depends on the home buyer along with the current market conditions. In my experience, a majority of cash buyers will only have one contingency, the inspection. While most financed buyers will have at least two contingencies, a home inspection contingency, and finance contingency but once again they may choose to remove or add additional contingencies.

Typically the more real estate contingencies a buyer has the more likely their offer won’t be accepted. So my best advice for home buyers is to work with an experienced Realtor who understands the market conditions and how to write a winning offer.

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About the Author

Top Wellington Realtor, Michelle Gibson, wrote: “4 Most Common Types of Contingencies When Buying a Home”

Michelle has been specializing in residential real estate since 2001 throughout Wellington Florida and the surrounding area. Whether you’re looking to buy, sell, or rent she will guide you through the entire real estate transaction. If you’re ready to put Michelle’s knowledge and expertise to work for you call or e-mail her today.

Areas of service include WellingtonLake WorthRoyal Palm BeachBoynton BeachWest Palm BeachLoxahatcheeGreenacres, and more.

4 Most Common Types of Contingencies When Buying a Home

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Michelle Gibson Wellington Florida REALTORMichelle Gibson of the Hansen Real Estate Group Inc is a full-time REALTOR who has been specializing in Wellington Florida real estate since 2001. This veteran of the real estate industry has expertise in technology, marketing, and social media.


Hansen Real Estate Group Inc. is a full-service real estate brokerage specializing in residential real estate. As a customer-focused, quality organization, we achieve success one client at a time. Call 561-333-0446 or e-mail me today at [email protected].

Michelle Gibson and Hansen Real Estate Group Inc fully support the principles of the Fair Housing Act and the Equal Opportunity Act. Accessibility Statement


If you are thinking about buying, selling, or renting your home, townhome, condo, or other Real Estate in the following areas; Wellington, Lake Worth, Royal Palm Beach, Boynton Beach, Greenacres, Loxahatchee, Royal Palm Beach, Lake Clarke Shores, West Palm Beach, Palm Beach Gardens, or Jupiter there are thousands of Realtors to choose from.

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