Friday, February 24, 2017 / by Jason Huerkamp
Contingent Upon a Mortgage
If you are borrowing money from a lender, you want to be sure that this condition is written in, because if it isn't, you may have to proceed with the sale without the protection of a mortgage or face legal and financial consequences. This would be pretty standard in any real estate contract and would be deleted should the purchaser be paying cash for the property.
Contingent Upon Selling Your Home
This would be important if you were purchasing a home and needed to sell your existing home in order to continue with the purchase of the new one. Normally this contingency would have a time period attached to it, so that the seller would not wait forever until your home sold. He may even write in another clause stating that he could accept the offer however if a better or more qualified offer was presented he may give you a chance to remove that contingency or forfeit the purchase of his property.
It would be a good idea to have a contingency in about the consequences of the home inspection. If the home did not meet your expected home inspection standards then it may be nice to be able to leave the contract without any financial consequences. Discuss this aspect with your experienced Real Estate Agent or better still, your attorney, who will be able to give you great advice.
If you are going to be securing the home with a mortgage, then the lender will send out an appraiser to view and value the property. He will look over the property, measure the property and check back with the lender about his valuation on the property. If the property does not match up to the expectations in terms of price, the lender may make you a lesser loan amount on the property. If that be the case you may want the appraisal to carry a contingency clause.
Other contingencies could include:
- an item you want replaced
- a item of furniture that you wish to include
- something you need to have specifically checked on the property, maybe the flood line or the trees that look as though they could fall down
A real estate attorney would be able to assist you with this.
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