What are contingencies in a real estate contract?

Contingencies in a real estate contract refer to conditions that must be fulfilled for the contract to become legally binding. These conditions are often outlined in the agreement and can include various scenarios, such as the buyer obtaining financing, the property passing inspections, or the seller providing clear title.

The inclusion of contingencies helps protect both parties in the transaction; for example, if a buyer cannot secure a loan, they are not obligated to proceed with the purchase. The presence of these stipulations ensures that all necessary requirements are met before the contract is fully enforceable, providing a safeguard for the parties involved.