MortgageMath US

Mortgage glossary

Contingency

The escape hatches in a purchase contract — and what you risk by waiving them.

By the Editorial team Last reviewed 1 min read

Quick answer

A contingency is a condition written into a home purchase agreement that must be met for the sale to go through — for example, getting a mortgage, an appraisal at or above the price, or an acceptable home inspection. If a contingency isn’t met by its deadline, the buyer can generally cancel and get the earnest money back.

Key facts

3business days

You get the appraisal at least this long before closing

CFPB, Regulation B 1002.14 · Oct 28, 2026

Common contingencies

ContingencyProtects you if…
Financing (mortgage)you can’t get the loan by the deadline
Appraisalthe home appraises below the price, so you can renegotiate or walk away
Home inspectionthe inspector finds problems you want repaired, credited or don’t accept
Home saleyou must sell your current home first and can’t by the deadline

Each has a deadline in the contract. Miss it without acting, and the protection usually lapses. Your lender must give you a copy of the appraisal at least 3 business days before closing, but don’t wait for that if your appraisal deadline comes sooner — ask for the report as soon as it’s done.

Waiving a contingency

In a competitive market, buyers sometimes drop contingencies to make an offer stronger. The risk is real: without a financing or appraisal contingency, a denied loan or a low appraisal can cost you your deposit or force you to bring more cash. An FHA appraisal is not an inspection, and FHA doesn’t guarantee the home’s condition. A pre-approval makes the financing contingency less likely to be needed. See the appraisal and inspection guide.

Sources

  1. CFPB, Regulation B 1002.14 — Lender must give you the appraisal at least this long before closing (or promptly) (Oct 28, 2026)
  2. Freddie Mac My Home: Understanding contingency clauses in homebuying
  3. HUD: For your protection — get a home inspection (HUD-92564-CN)

Last reviewed Figures are checked against the sources above. Read our editorial policy. This page is general information, not financial advice — see the disclaimer.

Buying a homeAppraisal and home inspectionWhat the appraiser and the inspector each check, your appraisal rights, low-appraisal options and contingencies.6 min readFirst-time buyersHow to buy your first home, step by stepTwelve steps from checking your credit to getting the keys, with the deadlines that matter.5 min readGlossaryLoan EstimateThe standard three-page form showing a loan’s rate, payment and closing costs after you apply.1 min readGlossaryClosing DisclosureThe five-page form with your final loan terms and closing costs, delivered before closing.1 min readGlossaryRate lockA lender’s commitment to hold your interest rate from the offer until closing.1 min readGlossaryClosing (settlement)The final step of a purchase or refinance, where you sign the loan and pay closing costs.1 min readGlossaryPromissory noteThe document you sign at closing promising to repay the loan on its stated terms.1 min readGlossaryDeed of trustThe security document used instead of a mortgage in many states, naming a trustee who can sell on default.1 min readGlossaryLienA legal claim against property that secures a debt and must be cleared before a clean sale.1 min readGlossaryMortgage servicerThe company that collects your payments, runs escrow and handles help if you fall behind.1 min read

On this page

  1. Quick answer
  2. Key facts
  3. Common contingencies
  4. Waiving a contingency
  5. Sources

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