How To Buy A House With A Contingency in 2024 – A Guide

home contingency

Purchasing a house can be an overwhelming experience, but it doesn’t have to be an insurmountable mountain. With the right knowledge and guidance, you can take control of your next home purchase and make sure you get the best deal possible.

One important thing to consider is buying a property with a contingency; this means that certain conditions must be met before the sale is finalized. It’s like having a safety net – just in case something goes wrong!

In this guide, we’ll show you how to buy a house contingent on a variety of things, so you can rest easy knowing your purchase is secure.

What is a Contingency?

contract 1

You may be wondering what a contingency is and how it can affect your purchase. A contingency clause in the purchase agreement allows you to back out of the deal if certain conditions are not met.

For example, if you need to sell your current home before buying a new one, you could include an “earnest money” contingency stating that you’ll have to earn back your deposit if you fail to sell your current house or don’t find a suitable replacement within a specified timeframe.

This type of clause is common in real estate transactions when buying and selling homes in the current real estate market. They give buyers peace of mind when purchasing their dream home because they know they won’t be stuck with two mortgages if they can’t sell their home.

On the other hand, sellers may prefer not to include contingencies as it might make them less competitive in today’s housing market. Ultimately, stipulations and clauses are important tools for ensuring both parties feel secure during a home purchase.

What Does Contingent Mean?


If you’re looking to make an offer without any strings attached, understanding what this really means is essential. In real estate lingo, contingent simply means when an offer is made on a property that has conditions or stipulations that must be met before the sale can go through. This clause helps protect both the buyer and seller during the transaction.

Here are three common types you should be aware of when making your offer on a home:

  1. Sale and Settlement – This type allows buyers to submit an offer on a home, but only if they’re able to sell their own home first.
  2. Financing – This type protects the buyer in case they can’t obtain financing from their lender as expected by a certain date or time frame after making an offer on the home.
  3. Appraisal – This type protects buyers by allowing them to back out from the contract if the appraisal comes in lower than what was offered for the property, helping them avoid potential financial losses due to overpaying for a home.

Contingencies are essential tools that help protect both parties involved in real estate transactions, and buyers need to understand how these work. They can then confidently make an informed decision about buying a home, knowing that their best interests are protected throughout the process.

Types of Home Sale Contingencies

home inspector

Home buying contingencies include items related to financing, inspections, appraisals, and more. The most common is an Earnest Money Back Clause which states that if a buyer cannot get financing or the inspection reveals major issues with the house, they can get their earnest money back. This gives buyers peace of mind by protecting them from losing their deposit if something unexpected happens during the home-buying process.

Another type of contingency is one where a buyer needs to sell a home before they can buy their next home. This type of contingency ensures that buyers will have enough money for closing costs and a down payment when it comes time to purchase their next home. If the house they are selling doesn’t sell within a certain amount of time, the contract will become void, and the seller is free to accept another offer or keep their current listing active until it sells.

Knowing all these types of home sale clauses and stipulations will give you confidence in your decision-making when buying or selling your house.

Common Contingencies in Real Estate

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Understanding the common contingencies in real estate can help you stay ahead of the game when it comes to closing a deal. They keep both parties’ interests protected and give you access to an arsenal of options.

The 5 most common contingencies encountered once the home is under contract include:

  1. Home inspection
  2. Financing
  3. Appraisal
  4. Home sale
  5. Title Search 

Familiarizing yourself with these variants can help you learn how to approach sale and settlement contingencies confidently without worrying about unexpected costs or delays down the line.

How to Make a Contingent Offer

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Submitting an offer with a stipulation or future requirement is the best way to protect yourself while navigating the real estate process so that you can close with confidence. When looking to buy, including a sale contingency in your offer may make it appear weaker, but will help protect you as a buyer. A real estate professional can assist in negotiating your offer on the house and ensure that all stipulations are properly included.

Here are three things to remember when making a contingent offer on a house:

  1. Home sale clauses protect buyers by allowing them to back out of an agreement if their current home doesn’t sell within an agreed-upon period of time.
  2. Real estate agents typically accept contingent offers, but without one, your offer may be less competitive than others who have included one in their bid.
  3. Ensure everything is clearly spelled out and understood by both parties before signing any paperwork related to buying or selling property. By understanding the process and taking precautionary measures, you can go through the buying and selling process confidently, knowing that your best interests are protected.

How Does a Contingent Offer Work?


A contingent offer is an agreement between the buyer and seller that certain conditions must be met in order for the sale of the property to go through. This means that contingencies in your offer are typically related to some specific requirement, such as needing to sell their current home before being able to purchase the new one.

If these conditions are not met, both parties can walk away without penalty. When it comes to real estate sales, buyers often want to submit an offer on an existing house but may not be able to until they’ve sold their own home or been pre-approved for a loan large enough for both properties.

In this case, buyers can create an offer with one or more stipulations, allowing them time to remove the home sale contingency and buy their new home without worrying about losing out on their best offer due to delays in selling their existing house or getting financing approval. This will also ensure that buyers can get their earnest money back from any deposits made with no financial penalty if something goes wrong during the sale process.

Ways to Buy a Home Contingent on Selling Your Existing Home

home for sale

If you need to sell your current home before purchasing the next one, you can make a contingent offer so that you don’t have to worry about losing out on your ideal home. Given this approach, you can put your existing house on the market and then move forward with buying another without having to wait until the sale of your home is finalized.

Experienced real estate agents can help walk you through this process and ensure that all stipulations are laid out clearly in the purchase agreement. However, it’s important to remember that they do not come without risk; if something goes wrong with selling your existing house or if it takes longer than anticipated to find a buyer, then you may not be able to move forward with the purchase of your next home.

In order for your offer to work, not only does your house must sell, but also any other clauses specified in the contract must be met as well. Nonetheless, making an offer for a house contingent on selling their existing property is still an option for those who want to buy their ideal home without having to wait until they’re ready and able to sell their current one.

What to Consider When House Hunting

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Don’t expect the process to be a breeze when house hunting – it definitely won’t be! There are many things to consider when buying a new home and ensuring that your current home is sold simultaneously. To make sure you get the best deal and make the most out of your house-hunting experience, you should always ensure that you have a qualified real estate agent by your side. They can help guide you through the process and make sure everything goes smoothly with both transactions.

It is important to remember that if you are buying a new home and selling an existing one, then both must occur simultaneously for the clause to take effect. Before entering into negotiations on either property, it is vital to price your home competitively so that it stands out in comparison to other homes on the market. Once an offer has been made on your home and accepted by the seller, this will give you leverage when negotiating for your future home since now both properties are under contract. This way, if something happens during either transaction or if unforeseen circumstances arise, then having this in place can protect you from potential losses or delays in closing both deals. 

Qualified AgentGuidance throughout the process & ability to navigate complex situations
Competitive PriceLeverage when negotiating & better positioning when competing against other homes
Home Sale ProtectionProtects from unexpected costs/delays & allows for simultaneous transactions

How to Buy a House with a Contingency Clause


A contingency clause is often included in an offer when the buyer’s current home is already on the market and needs to sell before they can purchase their new one.

These types of clauses are also ways to purchase a house that needs repairs or has other issues, as long as you make sure your offer outlines what must be done for it to become acceptable.

When you’re house hunting, being aware of these stipulations will help you understand what may be required so that you are prepared when it comes time to negotiate.

It’s important to remember that while they are designed to provide some protection for buyers, they don’t guarantee success and could even cost them money if not managed properly.

Navigating this process will help ensure a smooth transaction for all parties involved.

What to Look for in an Existing Home Sale Contingency

getting started

When looking to review existing contingencies on a home, it’s crucial to consider whether this is really worth it. Here are some key elements you should consider:

  • Ensure that the price of the house you’re buying is fair.
  • Make sure there’s enough time to sell your current property before the clause expires.
  • Check if any additional conditions need to be met before the sale can go through.

All of these are important aspects to look into when purchasing a home with a home sale clause. Considering these points will help ensure that your purchase goes smoothly and is worthwhile in the long run.


Learning how to buy a home with a contingency can be intimidating, but it’s important to remember that they do protect both buyers and sellers. If something unexpected happens, you can rest assured that you’re covered. With the right preparation and research, your sale can be stress-free.

You may feel hesitant at first, but if all parties are informed and prepared, you can be confident in your decision. Don’t let your fears hold you back from buying your next home.

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