When you make an offer on a home, one thing you want to consider is if it’s a good idea to add in some contingencies. These can provide you with a way to get out of that offer if you need it.
Without contingencies, your offer may appear more attractive to buyers, which is why people sometimes forgo these clauses. And you do have to decide what will work best for you and your situation, but it’s important to think about how contingencies can help you in making this decision.
Loan approval
One contingency that people will often use is simply approval for the financing they need to buy the house. You likely already have preapproval from a mortgage lender, but you want to make sure that you’re not legally obligated to buy the home if your final approval doesn’t go through.
A home inspection
Another common contingency is a home inspection. You are investing a lot of money in the home, so you need to know that you’re getting a quality house. If it doesn’t pass the inspection, you can walk away without losing anything.
Selling your home
If you’re buying a home while you still own a different property, you may consider a contingency saying that you don’t have to make the purchase until you sell the house you’re currently in. This way, you know that you’re not going to end up with both houses at the same time, which may be unaffordable.
Moving forward
These are just two examples of contingencies you may want to consider, so be sure you know what options you have moving forward.