Removing Contingencies When Buying a Home
Removing contingencies when buying a home in California means that you are waiving certain conditions in the purchase agreement that protect you as a buyer. These conditions are typically included in the contract to give the buyer an opportunity to back out of the deal if certain events or situations occur.
There are several types of contingencies that can be included in a home purchase agreement, including:
- Inspection contingency: This contingency allows the buyer to have the property inspected by a professional inspector. If the inspection uncovers any issues or defects, the buyer may be able to negotiate repairs or cancel the deal altogether.
- Financing contingency: This contingency allows the buyer to back out of the deal if they are unable to secure financing for the purchase.
- Appraisal contingency: This contingency allows the buyer to back out of the deal if the appraised value of the property is lower than the agreed-upon purchase price.
The stand number of of days for all the contingencies are 17 days in the California Purchase Agreement Contract. You can request additional days if needed or shorten the amount of days to make your offer more attractive to the seller.
When you remove contingencies, you are essentially agreeing to purchase the property regardless of any issues that may arise. This can be risky, as you may end up buying a property with hidden defects or paying more than the property is worth. However, removing contingencies can also make your offer more attractive to the seller, which may be necessary in a competitive housing market. Once you remove all your contingencies, your deposit money becomes non-refundable and paid to the seller in the event you cancel the purchase.
It’s important to carefully consider the potential risks and benefits before deciding to remove contingencies when buying a home. Working with Desert Real Estate Partners, we make sure to protect your funds and help you navigate the process of your contingencies.
On a standard purchase contract, your contingencies are not passive, meaning, you must remove them in writing. If problems arise, we can request extensions for a contingency or cancel the deal.
Make sure you fully understand what it potentially means when you remove your contingencies and then have to back out of the deal. Talk to your agent about how to handle problems and issues before it’s to late. If after you remove your contingencies and the seller fails to complete the sale, then you funds would be returned to you upon mutual cancellation by all parities.