Should You Waive Contingencies To Win a Home? 4 Situations When It Might Be OK

This is not an easy time for homebuyers. Simply put, housing inventory is at historic lows and home prices are at historic highs, resulting in one of the most competitive times to buy a house ever.

This red-hot market has prompted many buyers to go to ever-crazier lengths in their bid to land their dream home. One of their strategies? Waiving contingencies. It’s a tactic thought to make you stand out among other buyers and entice sellers with the promise of a speedy sale, but it’s also a risky move.

While certain contingencies should never be removed, there are some you can and should consider waiving in order to land a home. But before you do so, consult with a professional.

“I recommend having a word with your real estate agent to make an informed choice,” says Martin Orefice, the founder of Rent To Own Labs in Orlando, FL. “They have the experience and knowledge of the market to help you avoid any possible hassles.”

At the end of the day, you don’t want to waive too many contingencies and get into a sticky financial situation or own a house you can’t afford to repair.

To learn more about what circumstances might warrant waiving contingencies, we reached out to real estate agents for their insight.

1. If you’re buying with cash

Financing contingencies, also known as mortgage contingencies, are clauses in real estate transactions that give buyers a window of time to secure a bank loan for their home. But for buyers who don’t need a loan, this is a contingency they can waive without sweating the consequences.

“Financing contingencies protect buyers if their mortgage falls through, but if you’re buying a home in cash, it makes sense to waive this contingency,” says Orefice. “But before you waive it, ensure you have a sound budgeting plan to anchor your homebuying process.”

2. If you’re buying a shared structure in a homeowners association

A home inspection contingency, aka a due diligence contingency, gives buyers the right to have a third party (unaffiliated with the seller) inspect the home for potential problems or health hazards like water issues or radon.

While no responsible professional would encourage even the most eager buyer to skip the inspection completely, there are ways to work around it. If you’re buying a home in a homeowners association with a shared structure (like a roof), the HOA might cover the repairs.

Glen Pizzolorusso, a licensed real estate broker at Compass in Fairfield, CT, helped his buyer win a multiple-offer situation on a condominium. It was due to the buyer waiving inspections.

“We were comfortable waiving the inspection because this was part of an HOA, and big-ticket items like roof and water were the responsibility of the HOA,” he says.

Be advised, though, that repairs on single-family homes or detached condos and townhouses in HOA communities will likely have to be paid for by the owner. So, before submitting an offer, be clear about which repairs the HOA is responsible for and which repairs the owner has to pay for.

Pizzolorusso urges homebuyers to always do an informal inspection and to ensure they have the funds to replace big-ticket items like the furnace or roof before waiving an inspection.

He adds that he would never advise waiving a home inspection on a septic system, “unless you have $30,000 to $50,000 to replace a system if it’s shot.”

3. If you’re flexible on timing

Some buyers have the ability to wait a few weeks (or months) after closing to actually move into the home. If you’re not in a time crunch, you might consider waiving the right to possess contingency.

“Waiving the right to possess the property at closing is an easy way to stand out,” says Nicole Serviss, a licensed real estate agent with Re/Max Elite in Snohomish, WA.

Essentially, the buyer agrees to be more flexible about the move-in date.

“This allows the seller more time to move and gives them the cash they need to move to their next place,” Serviss says.

4. If you can risk carrying two properties at once

Another big headache for buyers and sellers is the home sale contingency. This contingency allows buyers to move forward with the purchase if, and only if, their home sells by a specified date. If it fails to do so, the buyers get their deposit back and the contract is terminated.

Not everyone could—or should—have this removed, as it essentially protects buyers from potentially paying two mortgages at once. But in some cases, it’s worth considering.

“While you do accept the risk of having to carry two properties at the same time, it shouldn’t take you long to sell your residence in this market if it’s priced correctly. And the bank won’t allow you to hold both properties if they don’t think you were financially capable of doing so,” says Bill Samuel, a licensed real estate broker and developer and owner of Blue Ladder Development in Chicago.

“If you are able to work with your lender to have this contingency removed from your offer, you will have a much higher chance of getting it accepted,” says Samuel.

Source: Kathleen Willcox (

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