Home Buying in New Braunfels>Question Details

Flsrntx, Home Buyer in New Braunfels, TX

Can someone explain the rules for making a contingency offer?

Asked by Flsrntx, New Braunfels, TX Fri Jun 8, 2012

Help the community by answering this question:

Answers

4
Aja Edwards’ answer
BEST ANSWER
Actually in Texas it's a little different. A contingency is also called a "Right of First Refusal". There's a whole addendum to the standard Texas contract that goes over how it works. Basically, the seller has to show the home as "Active - RFR" or "Under Contract, Contingency" depending on the MLS that the home is listed in. They can consider other offers, but can only bump yours if they get an offer that can close sooner. If the seller does get another offer in, they would then go to you and say "Hey, I got this offer, are you willing to waive your contingency?" If you can't, then they can terminate and go with the other offer. If you do waive the contingency, then they are stuck with your offer still.

That's the very basic run down, is subject to the specific terms of whatever your specific contract and addenda say. I'm not attorney and am not trying to give legal advice! You should consult an attorney if you have questions :) How's that for a disclaimer?

Hope that helps!
0 votes Thank Flag Link Fri Jun 8, 2012
Do you suggest retaining a real estate attorney from the get go, or just go through the listing agent of the property we are considering? Thank you for your expertise.
Flag Fri Jun 8, 2012
As a buyer, you can make a "contingency offer" on a property when you have a property to sell and require the proceeds from that sale to be able to purchase the new property.

You would present an offer and negotiate all items; i.e., sales price, survey, option time & fee, etc., with an Addendum to the Contract that states you must have the proceeds from your sale to be able to purchase. You would go ahead with an inspection during the option period to learn about the condition of the property.

The Addendum would state a date by which you would receive your proceeds. If you sell by that date, you would remove the "contingency" and close. If you do not receive your proceeds by the contingency date you might be able to negotiate an extension.

If the Seller negotiates an acceptable offer with a different buyer, they would give you notice and you would have the option of removing your contingency or backing out of the contract. You would receive your Earnest Money back as long as you had complied with all aspects of the contract.

I'd be glad to sit down with you and go over this at your convenience.
Chyrel
1 vote Thank Flag Link Mon Jun 11, 2012
Contingency sinply means that; for something to happen, something else has to happen:

When you have a Loan Contingency, you are saying that if your Loan does not come through, you are no longer obligated to buy the house.

When you have an Appraisal Contingency, you are saying that the Appraisal has to be high enough to cover the Bank loan, (the Bank will only loan 80% of the Appraised Value: If the Appraisal isn't high enough, you are not forced to continue with the deal.

When you have an Inspection Contingency, and there are things uncovered, Termites, Repairs, Foundation problems, etc.: In that case you will have three choices; accept the problems and proceed with the purchase, or, negotiate some or all of the repairs, or, walk away.

These would be the 3 most common.
Your Realtor can guide. you.

Good luck and may God bless
0 votes Thank Flag Link Fri Jun 8, 2012
Thank you and God Bless you as well.
Flag Fri Jun 8, 2012
If you make an offer on a house but it's contingent upon the sale of your current home, the seller has the right to keep the home actively marketed. You will continue with the terms of your contract (down payments, mortgage approval, home inspection) but other buyers have the right to make an offer also. Make sure you have a good Real Estate Attorney when entering into a contingency contract! Good luck :)
0 votes Thank Flag Link Fri Jun 8, 2012
Thank you.
Flag Fri Jun 8, 2012
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2016 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer