Usually, when people think of contingencies in a real estate transaction, they’re thinking of contingencies to protect the buyer. And that’s because contingencies to protect the buyer are fairly common, contingencies such as an inspection contingency or a financing contingency. Seller contingencies are less common, but they are used in certain situations to provide some seller protection in the transaction. If you’re a seller, should be aware of these and how to turn them to your advantage. So let’s take a look at some seller contingencies and how to use these contingencies in your favor when selling your house in Harford County.
A fairly common contingency that buyers use is the home sale contingency. This contingency stipulates that buyers must sell their current home before they can buy a new one. They are given a specified period of time to sell while being under contract with a seller. If they can’t sell their current home within that period, then they can back out of the deal with no repercussions.
A home sale contingency is a great deal for buyers, but not so much when you’re selling your house. It’s not used as much as it once was, but you will still see it in contracts. So if you’re selling your house in Harford County and encounter a buyer’s home sale contingency, you will need a kick-out clause to level the playing field and protect yourself.
A kick-out clause stipulates that you are allowed to keep marketing your house to other buyers for a certain amount of time. If you receive another offer during that period, you have to notify the buyer. The buyer then has 72 hours to come up with the money to purchase your home either by finding a buyer for their home or getting another mortgage. If the buyer can’t buy your home, then you’re free to accept the other offer and move forward with that deal.
Home of Choice Contingency
The home of choice contingency is another one you can use in your favor when selling your house in Harford County. It’s much like a seller’s version of the home sale contingency. Also known as a suitable property contingency, the home of choice contingency works like this . . .
When selling your house, if you find a buyer before you find another house to buy and move into, it allows you to keep looking for a new home for a specified time period. But if you can’t find a suitable new home, you have the option to end the deal with the buyer and stay in your current home.
Just be aware that this kind of contingency is seldom used because a buyer would have little recourse if you pull out of the deal. As a result, few buyers will agree to a home of choice contingency. So if you’re interested in pursuing this, be sure to consult a Harford County agent at 443-616-5486.
Also, if you’re selling your house and buying another house at the same time, a rent-back contingency may be a good option, especially if it’s likely you’ll sell your current house before you buy another to move into. This contingency obviates the need to move twice within a short period.
A rent-back contingency, as the name indicates, allows you to rent your old home from the buyer for a certain amount of time. This will ensure that you have a place to live while you’re looking for and buying a new home.
But, again, keep in mind that you are basically asking your buyer to do you a favor. And this means that you may have to compromise in other areas.
Expert Advice for Selling Your House With Contingencies
There are, then, contingencies that will protect you as a seller. It’s just that they are pretty complex and sometimes have more cons than pros. So if you want to use contingencies in your favor when selling your house in Harford County, be sure to contact us at 443-616-5486.