3 Contingencies You Should Never Waive When You Buy a Home

Dated: May 10 2022

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When you’re buying a home in Vero Beach, your real estate agent will build contingencies into your contract. Contingencies are important because they provide you with a way to get out of the deal if things go south.

3 Contingencies You Should Never Waive When You Buy a Home

Check out the three contingencies you should never waive when you buy a home.

Inspection Contingency

The inspection contingency gives you the right to hire a home inspector and to walk away from the deal if the inspector uncovers issues that would affect your enjoyment or use of the home. If you waive this contingency, you won't have any way of knowing what types of issues exist in the home, and you may not even have legal recourse if you discover the issues after moving in.

Financing Contingency

The financing contingency says that if you can't secure the money to buy the home (after a good-faith effort, of course), you don't have to make the purchase. Without this contingency, the seller can hold you liable and may even take you to court to try to force you to purchase the home. Although this is unlikely to happen, the seller is likely to be able to keep your earnest money deposit in a case like this. Having this contingency in place helps ensure that you get your money back if you can't get financed.

Appraisal Contingency

Before your lender will give you the money to purchase a home, it will require a home appraisal. The appraisal is an independent, third party determination of how much the home is really worth. If the appraisal is lower than the asking price, your lender is likely to deny you financing for the full amount. For example, if the home you want to buy is listed at $300,000 but appraises at $280,000, your lender will probably only let you borrow $280,000. You'll be on the hook for the remaining $20,000. However, with an appraisal contingency in place, if the house appraises lower than the asking price, you can walk away from the deal with your earnest money deposit intact.

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Alex "AMAC" MacWilliam IV

It was bound to happen the day Alex MacWilliam, IV was born…the Alex MacWilliam Real Estate family legacy would carry on. Fast forward to September 2013, when Alex IV joined the firm, and the famil....

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