What is a contingent offer?

A contingent offer is defined as an offer to purchase a property that is dependent on certain conditions being met. This type of offer typically includes specific criteria that must be fulfilled before the purchase can be finalized, such as securing financing, passing a home inspection, or the sale of the buyer's current home. These conditions protect the buyer's interests, allowing them an out if the specified contingencies are not satisfied.

In real estate transactions, contingencies are common because they provide a safety net for buyers, ensuring that they are not obligated to proceed with the purchase unless certain agreed-upon details are satisfactorily resolved. Understanding this concept is crucial for both buyers and sellers as it dictates the terms of the sale and can affect the negotiation process.