U.S. Mortgage Index

Contingency

Definition

A contingency is a written condition in a purchase contract. If it is not met, the buyer may be able to cancel or renegotiate under that contract. Common home-purchase examples include financing and inspection. It is not earnest money and not the purchase price.

In plain English

A purchase offer is often not a bare promise to buy at a price. It may say the deal depends on a loan approval, an inspection, or another stated event. Those conditions are contingencies. Earnest money is the deposit that shows the buyer is serious. A contingency is a contract condition, not the deposit.

Technical definition

CFPB's official Find the right home page is PRIMARY for financing and inspection contingencies in a purchase offer. CFPB key terms are supporting consumer context. Contract forms and remedies vary by state.

Why it matters

Buyers treat every contract problem as a contingency and every contingency as a refund rule. The written agreement controls.

Sources reviewed

Important note

Common home-purchase contingencies include financing and inspection. Contract forms, deadlines, and remedies vary by state and by the written agreement. This is not legal advice.