Contingencies protect the Buyer by giving them a way out if certain important things don’t happen. In Massachusetts, the most common contingencies include:

Mortgage Contingency

• The Buyer’s obligation to go through with the purchase is conditioned on getting approved for financing (i.e., a mortgage).

• If the Buyer doesn’t receive a mortgage commitment in writing by the deadline—and gives proper notice—they can cancel the Offer and get their deposit back.

• The Buyer must act in good faith and apply promptly to a lender.

Inspection Contingency

• The Buyer has the right to have the home inspected by licensed professionals (home, pest, radon, water quality, etc.).

• If the results are unsatisfactory, the Buyer can back out—in their sole discretion—as long as they notify the Seller by the deadline.

• If the Buyer doesn’t provide written notice in time, they waive the contingency and accept the property as-is.

 

You may have negotiated additional contingencies such as contingent upon Selling a currently owned home or contingent upon review of condominium/HOA documents or tenant leases. These contingencies will be contained in separate documents attached as an addendum or listed under “additional provisions”.  Sometimes there is a temptation to keep things “short” because this offer form is a relatively short document. You want to be as specific as you can be so that these contingencies are completely and correctly incorporated in the purchase and sale agreement.