03/09/2026
When a home enters escrow, contingencies are like parachutes — they give buyers the right to cancel the deal without losing their deposit if something doesn’t check out.
From the seller’s perspective, contingencies are the “what-if” window that holds the transaction in limbo… until the buyer removes them and locks in the deal.
The most common contingencies — from both sides of the table.
Buyers get the opportunity to inspect the property thoroughly — general inspections and specialists such as roof, sewer, fireplace, mold, pool, or AV systems.
For buyers, this reveals potential issues.
For sellers, it actually provides protection because the buyer learns about the home before closing, reducing the chance of disputes later.
The lender hires an independent appraiser to determine market value.
If the appraisal comes in lower than the purchase price, the buyer may need to bring additional cash to close — or they may choose to cancel the transaction.
This protects the buyer if financing cannot be finalized.
Even when buyers are pre-approved, underwriting conditions and final verification can sometimes delay or prevent a loan from closing.
The preliminary title report reveals liens, easements, ownership structure, CC&Rs, and HOA obligations.
Occasionally surprises appear — an old lien, an easement, or ownership that was never properly transferred into a trust or LLC.
This report identifies environmental risks such as fire zones, flood zones, fault lines, or liquefaction areas.
In California, this is simply part of understanding where the property sits geographically.
Buyers review HOA financials, reserves, rules, regulations, and meeting minutes.
Sometimes these documents reveal future assessments, lawsuits, or rule restrictions that matter to a buyer.
For buyers, contingencies are a due diligence period — the time to confirm the home is truly the right fit. For Sellers, you are much more protected from liability!
