Whether a buyer is making an offer to purchase a property from a seller or considering a counter-offer received from a seller, he or she must be very careful to ensure that the proposal includes certain clauses called contingencies which provide important protections for the buyer. A contingency is defined as an agreed to excuse for a party’s non-performance of the contract. Simply, it is a condition written into the contract which allows a party to withdraw without being in breach.
An important contingency for a buyer to consider involves a requirement that a buyer’s present home sell before he or she is obligated to purchase the new property. These clauses typically allow a seller to continue to market the property to other potential buyers. In the event the seller receives another offer to purchase the property that does not include this type of contingency, the seller is then required to notify the original buyer of the existence of the new offer. The original buyer then is given a certain amount of time to remove this contingency from the contract or lose the property to the new buyer.
The terms and conditions contained in a real estate contract set forth requirements and obligations that have direct impact on the buyers and sellers of property. A proper understanding of these clauses is vital to protecting your interests in real estate transactions. Please call an experienced attorney at the law firm of Paulson & Paulson, PLC for more information.