There are several reasons why a seller prefers fewer contingencies:
1.) The sooner a seller knows his house is sold, the sooner he can move forward with his own plans.
2.) If the buyer has lots of time to back out of the purchase contract because of one or more contingencies, something may happen to change whether the buyer wants to purchase the home.
There are different ways to make your purchase offer more attractive than the offers from competing buyers. Buying with all cash and with no contingencies is one of the strongest things you can do. If you need to get a loan or sell your current home there are things an experienced agent can do to make your offer more attractive.
Juliana Lee, MBA LLB
Top 3 real estate agent nationwide at Keller Williams Realty
Over 20 years experience
Over 1,000 home sales completed
In a highly competitive seller's market, specially where there is little inventory and a LOT of buyers, adding contingencies to you offer will weaken your offer. In today's market, a cash offer or approved loan offer, as-is sale, all contingencies removed and an offer among the top 3 offers will give you a very good chance of winning the bids.
Yes for sure.
A Contingency allows a Buyer to Back Out for " the reason called out in a contingency".
When a Seller in the present market if receiving any where from 8 - 44 offers on a property
with a Fourth all Cash with no contingency, and the other 1/3 coming in with cash and
no contingency, it becomes tough for Buyers to compete.
We live in a Metro that ranks in the top 10, where homes are selling the fastest.
If a Buyer is not in a position to bring more money to the table, I would not advise going without an appraisal contingency. Therefore the chance of them getting their offer accepted is slim. They need to understand that.
If they have parents who can gift them money, or other funds, it would be one way to get over the appraisal contingency. Buyers also need to understand, this is a heated market, one we've been in before and that is how inflation occurs. If they are not comfortable with paying more than a property is worth in an appraiser's mind, they can wait. Waiting may mean paying more. Because as these properties close they will be the new value.
And in life, what goes up - goes down. We just don't know how high and how long this one will last.
A contingency is a roadblock to completing a sale. As a result, in today's market, a contingency is deemed a weakness in n offer. The more contingencies that can be removed, the better.
Allison James Estates and Homes
This is why All California Mortage has just created the "Keys on Time" Loan Purchase Program to ensure that pre-approved and qualified purchase transactions fund on or before the scheduled Close of Escrow date.
Provided the loan type and the property type qualify for this program, and provided that we receives all required documents within the allotted time frames detailed in the program guidelines (The Close of Escrow must be a minimum of 18 days from loan submission)
Some exclusions apply.
Please feel free to contact me for details.
Senior Loan Consultant
All California Mortgage
A division of American Pacific Mortgage
P: (415) 464-8261
C: (415) 378-7508
F: (415) 464-2367
This isn't the typicaly siuation however and so a Seller needs to consider/factor-in how difficult might the buyer be over home inspections related issues? How good is thier credit and what's the likelihood of them getting their mortgage and being able to close on time? Do they need to sell and settle another property first? Are they asking me for things I'm not comfortable with etc? The more contingencies the more potential pitfalls for the Seller.
That said, solving or overcoming these contingencies is afterall what we get paid for.
At your service,
Certified Ditreesed Property Expert