Real Estate Contingency Lawyers
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What are Contingencies in a Home Purchase Contract?
Contingencies in a home purchase contract are basically conditions that need to be met before the final sales closing can take place. They operate much like “escape hatches”, allowing the buyer to walk away from the deal if the contingencies aren’t met.
In most real estate contracts, there are usually several weeks in between the signing of the contract and the actual closing of the sale. This time period is sometimes called “escrow”. It is during escrow that the contingencies are usually fulfilled by both parties. If the contingencies are not met by the final closing, either party can usually cancel the deal or renegotiate the contract contingencies.
What are Some Common Examples of Real Estate Contingencies?
Some examples of contingencies that commonly occur in a real estate contract have to do with:
- Financing: Real estate sales are often contingent upon the buyer being able to secure financing such as a mortgage loan, with which they will purchase the property
- Inspection: Most contracts require that the buyer be satisfied with the results of an inspector’s report. These may also include reports for environmental hazards
- Insurance: Many purchasers request an insurance contingency in the real estate contract. This is especially common in areas that have histories of environmental liabilities like hurricanes, mold, or earthquakes.
- Improvements: This is an agreement regarding the ability to make improvements or renovations on the property. Typically more common in commercial properties
There may be several other different kinds of contingencies in a real estate contract. These will depend on the needs and abilities of both the buyer and seller in the deal.
What are Some Legal Disputes Involving Contingencies?
Most legal disputes involving contingencies have to do with either negotiation or enforcement of the condition.
For example, it’s common for the parties to be unable to agree upon a certain contingency during negotiations of the real estate contract. This can make the process of closing much more difficult, since closing is often dependent on the fulfillment of the contingencies. The parties may sometimes need legal intervention to help reach an agreement on some contingencies.
Finally, while both parties are free to walk away from the contract if any contingencies are not met, there may sometimes be legal issues regarding the enforcement of a contingency. For example, if a contingency was fulfilled in a manner involving fraud or deception, the breaching party may need to reimburse the other party for any losses caused by the fraud. A common example of this is where an inspection report is falsified, in which case civil or criminal penalties may also result.
Do I Need a Lawyer for Help With Real Estate Contract Contingencies?
Contingencies in a real estate contract are important for securing the interests for both buyers and sellers. If you need assistance with a real estate contract, you may wish to hire a qualified real estate attorney in your area. Your real estate lawyer can help review any contingencies in your contract and can represent you in court if a lawsuit is necessary.
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Last Modified: 04-06-2012 02:56 PM PDT
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