Should you make an offer on a home without contingencies?

| Jun 4, 2021 | Residential Real Estate

Contingencies are included in most home purchase offers. For example, a home inspection contingency means that the person who makes the offer does not have to buy should the home fail the inspection. 

These contingencies are there to protect buyers, but some buyers opt to go without them. They submit offers with “no strings attached,” so to speak. 

Why would you do this?

There is a certain reluctance among some sellers to accept an offer if they see too many contingencies. Even if your offer is above the asking price, they may take a lower offer. 

For instance, some buyers already own homes and decide to use sale contingencies. Essentially, it means that they have to sell their home. If they can’t, they’re not obligated to buy the new home they just selected. It’s clear why the buyer does this, as they don’t want to be stuck with two mortgages, but some sellers want nothing to do with that kind of deal. If they accept an offer, they don’t want to risk having it fall through because that buyer had issues on their end. 

Removing contingencies, then, makes the seller more likely to pick your offer. You may save money and you may even edge out someone who is willing to pay more. You take a risk, but you increase your odds of getting the house you want in a competitive market. 

What should you do?

There are a lot of things to consider here, and every buyer has to make this decision on their own. What is important is to know what legal options you have, what advantages and disadvantages there are, and what goals you have for the transaction.