We all know that property hunting is not a one-day task. It involves a thorough research and due diligence, which can take months or even a year to find a dream home. If you are planning to buy a house, then there are some common terms that are used in the property purchase process. One of such terms is ‘contingent’. Now, what is contingent? Let’s find out:
“Contingent” in real estate can be defined as a condition on which the sale depends. When a property is listed as contingent, it just means that an offer has been made by the seller and accepted by the buyer, but before completing the deal, there are some additional criteria that need to be met.
For example, if a seller asks for a specific price and the buyer says that he is fine with the price (given there’s no issue with the home inspection), then this is a case of a contingent contract. In this case, the property sale depends on the inspection not having issues mentioned in the contract.
Now you know what does contingent mean on a house.
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This is How Contingent Offer Works?With a contingent offer, the buyer has mentioned that a particular condition needs to occur before sealing the deal. If it doesn’t, the contract is void, and the seller can go to a backup offer received while the sale was contingent.
A contingency is generally used to protect the buyer from unforeseen issues and problematic property listings within the real estate transaction.
Let’s refer to the example mentioned above, let’s say that the buyer makes the offer contingent on the property inspection showing a roof life of 10 remaining years. If the inspector says the roof only has 5 years left, then that is not acceptable and an active contingency status will be placed on the property. The seller then might fix the roof or adjust the price, or the buyer can decide to exit the contract.
If You Want Any Help in Property Buying/Selling Transaction, then Reach Out to NoBroker’s Legal Experts!
Read more:
What are disclosures in real estate?
How to ask for real estate reviews?
What is ingress and egress in real estate?
What is GST rate on real estate?
I hope now you have a complete understanding of what is contingent in real estate.
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What is contingent?
Babita
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2022-05-18T18:42:56+00:00 2023-06-14T14:16:27+00:00Comment
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