Today we're going to talk about "contingencies".
If you've ever seen a real estate contract or talked to someone buying or selling, this word has probably come up. But what does it mean?
At its most basic, a contingency is a "condition" to a contract. When you write an offer, you're basically saying, "Look, I'll buy the house, but only under certain conditions."
In Los Angeles, there are three main contingencies Buyers use all the time:
- Loan Contingency
- Appraisal Contingency
- Inspection Contingency
If you have these contingencies, and things change, you might be able to get out of the contract if you need to. Like if you get denied for your loan, find out the house is being held together by duct tape, you have protection.
The point of a contingency is to give you "peace of mind"... and confidence to write offers on homes that you like. If you haven't done it before, signing on that dotted line can be nerve-wracking, so having these contingencies are helpful.
One word of caution for all the Buyers and Sellers out there: Yes, every real estate agent in Los Angeles uses the same contract. But think of these more as the "paint brushes" rather than the "finished paintings" themselves.
That being said... find yourself a good painter 🙂