When buying a home in Pennsylvania, it's important to understand the contingencies that are typically included in a real estate contract. Contingencies are in place to help protect the home buyer by ensuring certain conditions are met before the sale can be completed. In this article, we will discuss the three most common contingencies: buyer home inspections, appraisal contingency and title contingency.
The home inspection contingency is one of the most important contingencies in a Pennsylvania real estate contract. This contingency allows the buyer to have the home inspected by a professional before the sale is finalized. If any issues are found during the inspection, the buyer can negotiate with the seller. For example, they can ask the seller to make repairs, or ask for a credit to cover the cost of repairs. Alternatively, the buyer can choose to terminate the sale if the issues are to significant or if an agreement cannot be made.
The appraisal contingency is typically included in an agreement when a mortgage company is involved. The purpose of the appraiser is to obtain a second opinion on the property's value from a third-party, unbiased source. An appraiser will assess the property and produce a report on its value. Should the appraisal come in lower than the purchase price, the buyer has the option to renegotiate the price with the seller or terminate the agreement if both parties cannot reach a consensus.
The title contingency ensures that the seller has the legal right to sell the property and that there are no liens or other issues that would prevent a clear title from being transferred to the buyer. If any issues are found, the seller is responsible for resolving them before the sale can be completed.
The three contingencies discussed in this article are crucial protections for home buyers in Pennsylvania. The buyer home inspections contingency ensures that the home is in good condition, the appraisal contingency protects the buyer from overpaying for the property, and the title contingency ensures that the buyer will receive a clear title.