Buying a New Construction with a Contingency Agreement

I'm interested in buying new construction but they won't give me a contingency agreement. What could happen if I don't sell my existing house?

1 Answer

When writing an offer with a "contingency" clause you are stating that you will proceed with the purchase so long as "x" happens and the seller agrees to wait to see if "x" happens.

When writing an offer without a contingency agreement in the hopes that your home will sell in order to proceed with the accepted offer and you go into escrow and your "existing" home does not sell and you cannot perform it then opens you up to the potential of losing your deposit and the upfront expenses incurred during the purchase process, i.e. your appraisal fee, your home inspection fee, termite inspection fee etc.

However, you would also have to qualify for a new loan by also qualifing to have 2 mortgages in case your home does not sell. Therefore you would have to qualify for mortgage one (your existing home) if you have a current mortgage and the new loan as well.

Hope that helps.