Home buying contingencies are a crucial component of a written offer to buy a home. Essentially, they are conditions of your purchase. If these contingencies are not met, your offer contract for the home purchase is void. Submitting an offer with contingencies included protects you from purchasing a home under anything less than your ideal conditions.
4 Home Buying Contingencies You Should Consider:
- Inspection Contingency
Buying a Fort Lauderdale luxury home without a professional inspection is not recommended. Without an inspection, you might unwittingly purchase a home with unwanted things like mold, termites, faulty appliances and/or structural damage. Your offer to purchase a home should include an inspection period. This negotiated time frame will give you the opportunity to perform due-diligence on the property. If during that time you don’t like what you see, in most cases, you can re-negotiate the terms of the contract, or cancel the contract and have your earnest money returned without penalty.
- Appraisal Contingency
An appraisal is necessary in order for you to get financing. Therefore, this is one of the home buying contingencies that should be non-negotiable when you are working with the seller. The amount your mortgage lender is planning to loan you is based on the assumed worth of the home. If the home’s appraisal comes in lower than expected, the bank will revise the amount they plan to loan you.
- Loan Contingency
Your mortgage lender’s pre-approval letter will state very specific terms for your mortgage. These terms will include things like an interest rate and loan amount that you’re comfortable with. Should your financing not come through as expected, for whatever reason, a loan contingency will protect you from having to go through with the purchase.
- Title Contingency
A clean title will ensure that you have full rights to the property — a must-have before closing. Including a title contingency in your written offer allows you, the buyer, to certify your potential new home is free of liens, unpaid property taxes, non-permitted additions, or deed errors before purchase.
When you team with a Luxury Living Fort Lauderdale agent, he or she will be able to walk you through all the necessary home buying contingencies for your particular situation. Our goal is to make sure your interests are protected at all times during a real estate transaction. That’s peace of mind you can count on.