By Jill Skibinsky
In a competitive market like Westfield, New Jersey, real estate contracts move quickly—but they’re rarely simple. One of the most important, and often misunderstood, parts of a purchase agreement is the contingency.
As a Westfield real estate agent, I regularly guide buyers and sellers through contingencies because they play a critical role in protecting both sides while keeping transactions on track.
Whether you’re buying a classic Colonial near downtown, a Tudor on the North Side, or selling a long-held family home close to Westfield’s top-rated schools, understanding how contingencies work can help you avoid surprises and make smarter decisions.
Let’s break down what contingencies are, why they matter, and how they function in today’s New Jersey real estate market.
What Is a Real Estate Contingency?
A real estate contingency is a condition written into a purchase contract that must be met for the transaction to move forward. If the contingency is not satisfied within a specified timeframe, the buyer or seller may have the right to renegotiate or cancel the contract without penalty.
In essence, contingencies create a safety net. They allow buyers time to complete due diligence and sellers clarity on the buyer’s ability to perform. In Westfield, where homes often receive multiple offers, how contingencies are structured can significantly impact the strength of an offer.
The Home Inspection Contingency
The home inspection contingency is one of the most common and important protections for buyers. It allows the buyer to hire a licensed home inspector to evaluate the property’s condition after the contract is signed.
In Westfield, many homes feature older construction, original craftsmanship, and architectural charm. While these homes are often well maintained, inspections can uncover issues such as aging roofs, outdated electrical systems, or foundation concerns. If significant issues arise, the buyer can request repairs, credits, or, in some cases, cancel the contract.
For sellers, understanding this contingency is equally important. Proper preparation—such as addressing known issues before listing—can reduce renegotiation and keep deals moving forward.
The Mortgage or Financing Contingency
A mortgage contingency protects buyers by making the contract dependent on their ability to secure financing. Even with a strong pre-approval, final loan approval can depend on underwriting, appraisal results, and financial documentation.
In a market like Westfield, where purchase prices can be substantial, mortgage contingencies are standard. They specify how long the buyer has to obtain a loan commitment and what happens if financing falls through.
From a seller’s perspective, offers with shorter financing timelines or stronger loan profiles may be more attractive. From a buyer’s standpoint, this contingency provides crucial protection against unforeseen lending issues.
The Appraisal Contingency
An appraisal contingency ensures that the home appraises at or above the agreed-upon purchase price. If the appraisal comes in low, the lender may not approve the full loan amount.
In Westfield’s fast-moving market, bidding wars can push prices above comparable sales. An appraisal contingency allows buyers to renegotiate or walk away if the home does not appraise, while sellers may need to decide whether to lower the price or wait for a different buyer.
Understanding local market values and working with an experienced Westfield real estate agent can help reduce appraisal-related challenges before they arise.
The Attorney Review Contingency in New Jersey
New Jersey is an attorney-review state, which means that after a contract is signed, both parties’ attorneys have a limited period—typically three business days—to review and approve the agreement.
During attorney review, the contract can be modified or canceled. This contingency is unique to New Jersey and plays a critical role in ensuring that the contract terms accurately reflect the intentions of both parties.
In Westfield transactions, attorney review often includes clarifying inspection terms, timelines, and responsibilities. While it can feel like a formality, it’s a powerful contingency that should never be overlooked.
The Home Sale Contingency
A home sale contingency makes the purchase dependent on the buyer selling their current home. This is more common for move-up buyers who already own property.
In a strong market like Westfield, home sale contingencies can weaken an offer, particularly when sellers have multiple bids. That said, they are sometimes unavoidable and can be structured carefully to reduce risk for the seller.
For buyers, timing and pricing their current home correctly is essential. For sellers, understanding the buyer’s plan and timeline helps determine whether the contingency is acceptable.
Waiving Contingencies: Risks and Rewards
In competitive Westfield bidding situations, buyers sometimes waive contingencies to strengthen their offer. While this can make an offer more appealing, it also increases risk.
Waiving an inspection contingency means accepting the home as-is. Waiving an appraisal or financing contingency can put a buyer’s deposit at risk. These decisions should never be made lightly.
I help buyers understand when waiving a contingency may make sense—and when it’s better to hold firm. The goal is always to balance competitiveness with protection.
How Contingencies Affect Negotiations
Contingencies don’t just protect parties; they also shape negotiations. Repair requests, appraisal gaps, and financing timelines can all become negotiation points after the contract is signed.
Clear communication and realistic expectations are key. In Westfield, where transactions often involve tight timelines and high-value properties, experienced representation makes a measurable difference in navigating these moments successfully.
Frequently Asked Questions About Real Estate Contingencies
Are contingencies required in New Jersey real estate contracts?
Some contingencies, like attorney review, are standard in New Jersey. Others are optional but commonly used to protect buyers.
Can a seller reject an offer because of contingencies?
Yes. Sellers may choose offers with fewer or cleaner contingencies, especially in a multiple-offer situation.
How long do contingencies usually last?
Timelines vary, but inspection contingencies often last 7–14 days, and mortgage contingencies can range from 30–45 days.
Is it safe to waive contingencies in Westfield?
It depends on the situation. Waiving contingencies increases risk and should only be done with a full understanding of the potential consequences.
Can contingencies be renegotiated after contract signing?
Yes. If issues arise during a contingency period, buyers and sellers can renegotiate terms or credits.
Real estate contingencies can protect you—or cost you—depending on how they’re handled. If you’re buying or selling a home in Westfield, NJ, having expert guidance can make all the difference. I’m here to help you navigate contracts strategically and confidently.
Connect with me directly and take the next step with clarity and peace of mind.
