When you're purchasing a property, one of the most significant legal areas to consider are contingencies. These standards help protect your best interests and your investment. However, like other aspects of a contract, they are complex, making it crucial you work with a real estate attorney. In the meantime, here's what you should know.

What Are Real Estate Contingencies?

A contingency refers to a minimum condition or action that the seller must meet for your contract to be active and valid. These standards are placed into effect once a seller accepts an offer from a potential buyer. If they do not meet these standards, buyers have the legal right to back out of the sale without risk of losing their down payment.

What Contingencies Do Real Estate Attorneys Recommend?

Most real estate attorneys recommend three crucial standards as part of any potential sale: appraisal, home inspection, and financing or mortgage contingencies. With an appraisal contingency, the lender hires a third party to appraise the value of the property. If their findings determine the value is lower than the asking price, the buyer can back out to avoid overpaying.

With a home inspection contingency, the buyer has the right to hire an inspector. If the report turns up any significant issues with the property, the buyer can back out of the sale or ask the seller to handle the repairs before they move in.

With a financing or mortgage contingency, the buyer has the necessary time to secure a loan for the purchase. If they are unable to get the money, they can back out of the agreement and keep their deposit. This protects the buyer from taking on a purchase they can’t afford.

If you’re seeking a knowledgable real estate attorney to represent your interests in a property purchase, turn to Dennis P. Faller, Attorney at Law. This lawyer serves homeowners throughout Auglaize County, OH, and will guide you through every step of the proceeding to help ensure a favorable outcome. Visit their website to learn more about what they do, and call (419) 738-4578 to schedule a consultation today.