Contingencies in Real Estate Deals

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Retail shopping is usually pretty uncomplicated. The price is posted on the item, and if there’s a discount or sale it’s posted as well. Car shopping is another experience entirely, and we don’t want to get into the craziness of the sales person going into the manager’s office over and over to see if you can get the deal you want. We’re also bargaining on features and add-ons to the car. We all know it’s a bunch of baloney, but we have to play the game to get the car.

There’s another world out there when you shop for a home. We have a posted price, but everyone knows that it is just a starting point. Buyers know they’re going to offer less, and sellers know that they’re going to counter offer and do some negotiating. It doesn’t stop there though, as there are also features as with the car bargaining. Even more complicated, we have inspections, repair negotiations, title issues and other variables in a home purchase.

Negotiating a home purchase contract can be fun or frustrating, depending on who you are and your disposition. It can also depend on how much you want the home or whether or not you can walk away from the deal and find another one. Another major differentiation in this negotiation process is that it can go on over a relatively long period of time. Buying that car is a few hours, while buying a home can result in negotiations over 30 days or more.

Called contingencies, buyers make offers and sellers make counter offers around more things than price. Whether the seller will leave that free standing hot tub or that storage building are contingencies. A deal contingent upon the seller paying closing costs for the buyer is another you’ll see now and then.

Keep in mind that there’s a lot more involved in a home purchase negotiation than just the price.

Doug Clark
Star of Spike TV’s FLIP MEN
RealtyTrac Education Partner
#1 Real Estate Coach and Mentor Worldwide
Follow @demo_doug

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About the author

Doug Clark

Star of Spike TV's FLIP MEN. RealtyTrac.com Training Partner. #1 Real Estate Trainer Worldwide

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