What Is a Contingency (and Why Do You Need One)?

Andrew Georgitsis
Jul 25
2 min read

📄 What Is a Contingency (and Why Do You Need One)?When you make an offer on a home, contingencies are your safety net—they protect you from surprises.

🛡 What Is a Contingency?

A contingency is a clause in your offer that says:

“I’ll move forward with this purchase if X happens.”If X doesn’t happen, you have the right to cancel the deal—usually with your deposit refunded.

They exist to protect you from risk while giving you time to fully investigate the home and your financing.

🧱 Common Types of Contingencies

1. Inspection Contingency Let’s you inspect the home and cancel (or renegotiate) if serious issues are found.

2. Appraisal Contingency

If the home appraises for less than the offer price, you can walk away or renegotiate.

3. Loan (Financing) Contingency

Protects you if your loan falls through due to underwriting or credit issues.

4. Sale of Buyer’s Property Allows time to sell your current home before committing to the new one.

5. Title Contingency Ensures the property has a clean title—no liens or ownership issues.

⏳ How Long Do You Have?

In California, the default timeline is usually:

🏠 Inspection: 17 days
💰 Loan & Appraisal: 21 days
🖊 Final Closing: ~30 days

But timelines can be customized—and sometimes shortened in competitive markets.

⚠️ Should You Ever Waive Contingencies?

Sometimes buyers are advised to waive one or more contingencies to win a bidding war.But that adds risk. Always talk it through with your agent first.