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What are Contingencies in Real Estate?

Landed | 10 Jul 2019

When you submit an offer as a buyer, you can protect yourself by including contingencies on your offer. Read on to develop a stronger understanding of what types of contingencies exist. Use the infographic below to help tackle questions like: 

  • What are real estate contingencies? / What is a buyer contingency?
  • What types of contingencies exist?
  • Which contingencies should I include on my offer?
  • What is an appraisal contingency?
  • What is an inspection contingency?
  • What is a loan contingency?



Understanding Contingencies

When you submit an offer as a buyer, you can protect yourself by including contingencies on your offer.

Contingencies are conditions that must be met in order for your offer to successfully make it through to closing. If you include contingencies and they are not met, you will be able to back out of your offer and get your deposit back.

Talk to your agent about which contingencies to include and the timeline in which they should be met.

The most common types of contingencies:

Appraisal Contingency: If included, you agree to purchase this home as long as the home appraises for a certain value stated in your offer (typically the purchase price).

Inspection Contingency: If included, you agree to purchase the home as long as you, as a buyer, are satisfied with inspection reports and disclosures.

Loan Contingency:  If you include a loan contingency, you agree to purchase the home as long as your loan is fully approved. Although you have gotten a mortgage pre-approval, a lender will move your application through the application process once your offer is accepted.

You can include one contingency, all contingencies, or no contingencies. Each situation is different and the most important thing is that you understand and feel comfortable with the risks.

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About the Author


Former educators on the Landed team created these materials to help you on your homebuying journey. Landed supports educators on the path to homeownership by providing a personalized team that includes a partner agent and a Landed homebuying expert. We help families navigate all of their options for buying a home, including our own shared equity down payment program. Our team provides free homebuying education and guidance as well as competitive offer reviews for educators. Landed works with K-12, college, and university employees in expensive metro areas like San Francisco, Seattle, Portland, Denver, Los Angeles, San Diego, and Hawaiʻi. To learn more visit landed.com.

Looking for Landed's down payment program? Due to a temporary unavailability of DPP investment funds, all Landed metro areas are being put on a DPP waitlist effective September 8, 2022. You can read all the details (including FAQs) here if you would like to know more.