Buying and selling a home can be tricky. Some feel that a way to make things go more smoothly is to waive contingencies. This may or may not be a good idea. Let’s explore some of the most common contingencies and see how waiving or not waiving them.
One common contingency is an appraisal
This may not be a contingency you can waive as a buyer since your mortgage company or bank may require it. Appraisals can be tricky because they can be very subjective. That can make it difficult to sell. Sellers will definitely like this contingency to go away, since market price may not be what the appraiser comes up with and that could put the kibosh on the sale.
Another common contingency is the home inspection. A home inspection is a very important thing for buyers. It gives you an out if something big is wrong with the home. Many serious home issues can be very hard to see, or easy for sellers to hide. A licensed inspector knows where and what to look for when inspecting a home. If you waive an inspection contingency you are stuck with any issues the home has, big or small. If you really think that waiving the inspection is a necessary risk in order to get the home, first try and see if you can get it inspected and not waive the right to walk away if there is a huge problem, but waive the right to ask for the seller to fix problems.
Another contingency that is a bit less common, but comes up is requiring clear title. DO NOT WAIVE THIS! Here’s a few good reasons why. First, if there are any judgments attached to the property and you waive clear title, guess who will be stuck paying those judgments? YOU. If there are issues with property lines, you will be the one who has to pay to clear up the issue.
If you are buying and are asked to waive the financing contingency, don’t. This is a contingency that protects you from having to continue with the sale if your financing falls through. Without it, you could be forced to purchase the home, or open yourself up to a lawsuit if you breach the contract for sale.