What Is a Contingent Offer?
A contingent offer allows a buyer to back out of a home purchase if a condition isn’t met
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When buying a home, it’s important to know your rights as a buyer. Home purchase agreements are legally binding and require you to follow through on your offer to purchase a home. However, contingencies can be built into your offer to give you more flexibility, allowing you to back out of a home purchase without losing money.
Contingent offers are a normal part of the homebuying process and help protect buyers in case of surprises along the way. Below, we’ll cover how contingent offers work, what types of contingencies are common and how to use contingencies to negotiate a home purchase.
A contingent offer is an agreement to purchase a home if certain conditions are met.
Jump to insightContingencies may be included for appraisal, home inspection, financing and the buyer’s own home sale.
Jump to insightContingent offers are typically built into purchase agreements.
Jump to insightWhat does a contingent offer mean?
In real estate, a contingent offer is an offer to purchase a home, but it includes clauses that protect the buyer should certain circumstances arise. This allows the buyer to back out of the transaction if a contingency isn’t met. The buyer or the buyer’s real estate agent will present a contingent offer to the seller.
“A contingent offer typically includes conditions such as the buyer securing financing, a satisfactory home inspection or the sale of the buyer's current property,” said Jenna Alberta, owner of Mobile Home Buyers, a real estate investment company. “If any of these conditions are not met, the buyer can withdraw from the offer without penalty.”
Types of contingencies
There are several types of contingencies that can be added to a home offer.
Appraisal contingency
Typically, your mortgage lender will only finance a home purchase for the amount that the home appraises for. If the appraisal comes back lower than the purchase price, you may need to make up the difference with a larger down payment.
An appraisal contingency gives you the ability to walk away from the transaction without penalty if the appraisal comes in lower than the purchase price. If you decide to purchase the home anyway, you can try to negotiate the price down closer to the appraised amount.
Financing contingency
A financing contingency gives the buyer a set period of time to secure financing. This can be used if you haven’t been preapproved for a mortgage yet and want to submit a quick offer on a property. You’ll typically have 30 to 60 days to get approved for financing with this contingency, though it may depend on how your offer is written.
A mortgage preapproval can help speed up the financing process by allowing you to go through most of the lending paperwork before you submit an offer. This allows you to shorten the financing contingency to make your offer stronger for the seller.
Inspection contingency
When buying a home, getting a third-party home inspection can make sure there are no glaring issues with the property or house. An inspection contingency allows you to back out of the transaction without any penalties if a major problem is found during the inspection process.
You can also use this contingency to require that sellers fix the issue before proceeding with the transaction, or you can ask that sellers lower the price of the home to compensate for the issue. For example, if the roof has a leak, you can ask to have it fixed or be compensated for the cost of repair before agreeing to purchase the home.
Home sale contingency
If you have a house that you need to sell before you can afford to buy another home, you can write a home sale contingency into your offer. This contingency allows you to submit an offer that is dependent on the sale of your current home, usually within a certain number of days after the offer is accepted.
If you can’t find a buyer for your home within the time allotted, you can back out of the transaction. But it’s important to note that a home sale contingency constitutes a weaker offer, as sellers will be depending on you to sell your home in order to sell theirs. In a seller’s market, these offers may get rejected more often than not.
» MORE: Buyer’s market vs. seller’s market: What’s the difference?
Title contingency
A title contingency allows buyers to back out of a home purchase if there are title issues discovered during a title search. Some listed homes may have liens against them or unresolved easement issues, resulting in an unclean title.
Even if there aren’t any title issues during the purchase, it’s a good idea to get title insurance, which protects against any future claims on the title.
How to make a contingent offer
A contingent offer is common practice in real estate purchases. Here’s how you can make a contingent offer:
1. Indicate contingencies in your purchase agreement
Many state purchase agreements include options for contingencies built into the form. Indicate which contingencies you wish to require. For example, if you need to sell your home to make the purchase, indicate that this offer is contingent on the sale of another property.
2. If a contingency is not met, make a choice
After your contingent offer is submitted, you’ll continue with a title search, inspection, appraisal or the sale of your current home. If a contingency is not met during this process, you can choose to continue with the offer and negotiate, or you can walk away without penalty and receive your earnest money back.
3. Negotiate based on the unmet contingency
If you’re still interested in purchasing the home despite the unmet contingency, you can now negotiate. For example, if the home inspection shows termite damage, you can ask the seller to remedy the problem or drop the home price by the cost of termite damage repair.
You may have several contingencies in your offer, so each unmet contingency is a point of negotiation and gives you the ability to walk away if needed.
4. Sign the purchase agreement and close on the home
Once you and the seller come to an agreement, you can move forward and close on the home.
FAQ
Can I waive contingencies?
Contingencies can sometimes be waived. Waiving contingencies makes your offer stronger, but you sacrifice security as a buyer.
“Contingencies can sometimes be waived if the buyer is confident in their ability to secure financing or if they are willing to assume any potential risks,” Jenna Alberta said. “However, waiving contingencies is not a decision to be taken lightly and should be done after careful consideration and consultation with professionals.”
How long do contingent offers last?
Contingent offers can last as long as you want, but sellers won’t want to wait forever to resolve unmet contingencies. For example, if you write in a home sale contingency that gives you six months to sell your home, the seller may require a kick-out clause that allows them to keep their house on the market to field better offers. Reasonable contingent offers typically last 30 to 60 days, but it depends on your offer, the seller and your market.
Can a seller back out of a contingent offer?
Sellers can write their own contingencies into the purchase agreement, which allows them to back out of a contingent offer. For example, the seller can set a deadline for all purchase offers, allowing them to back out if a buyer cannot complete the purchase in the allotted time frame.
What happens after all contingencies are removed?
If all contingencies are removed from a purchase agreement, the buyer is contractually on the hook to purchase the home. This means the buyer is accepting the property in its current condition. If the buyer backs out for any reason, the seller may be able to keep the earnest money put up by the buyer.
How often do contingent offers fall through?
It’s not very common for contingent offers to fall through. Roughly 7% of home contracts were canceled over the last several months and 6% were delayed due to appraisal issues, according to the National Association of Realtors’ (NAR) October 2025 Realtors Confidence Index Survey. However, about 20% of buyers waived the inspection contingency and 19% waived the appraisal contingency.
Bottom line
A contingent offer is a smart tool to use as a homebuyer, as it allows you to protect yourself from surprises during the homebuying process and gives you some negotiating leverage as well. But contingent offers can be seen as weak and may be rejected by sellers when the real estate market is booming. It’s a good idea to work with an experienced real estate agent when making an offer on a home to ensure you use contingencies strategically.
Article sources
ConsumerAffairs writers primarily rely on government data, industry experts and original research from other reputable publications to inform their work. Specific sources for this article include:
- National Association of Realtors, “October 2025 Realtors Confidence Index Survey.” Accessed Nov. 20, 2025.
