An offer states that the purchase depends on the buyer obtaining financing and a satisfactory inspection. Those conditions are contingencies. If they are not met, the buyer can usually cancel without losing the earnest money.

Common contingencies cover inspection, appraisal, financing, and the sale of the buyer’s current home. Sellers may accept, reject, or counter them. In competitive markets, buyers sometimes waive contingencies to strengthen their offers, accepting greater risk.

Deadlines matter. Missing a contingency removal date can put the earnest money at risk or force the deal forward. Clear written language prevents later disputes about what was required. Contingencies protect parties from being locked into a transaction when key assumptions fail.

A well-crafted contingency is insurance; a vague one becomes a source of conflict.