Buy Alexandria Real Estate: It's Contingent! What is? Your Home Purchase or Sale in Northern Virginia

Alexandria Virginia Real Estate Blog

It's Contingent! What is? Your Home Purchase or Sale in Northern Virginia


There's the dictionary definition of contingent.

Whether you're buying a home or selling a home in Northern Virginia, you're likely to have a contingent contract and need to understand the different contingencies that may exist.

In essence, a contract contingency is a mutually agreed upon escape clause that allows one of the parties to the real estate deal to unilaterally terminate the contract without penalty.  The Regional Sales Contract in Northern Virginia (which is generally used in D.C.) contains a number of contingencies that can affect buyers and sellers of homes.

The most prevalent contract contingencies are the following:

  • MortgageFINANCING -- These clauses make the contract dependent upon the purchaser getting approved for the mortgage financing for which they apply.  Unless purchasing a home for all cash, a buyer will need a mortgage loan.  If they cannot be approved for financing, they will not be able to buy the house.  This contingency protects the buyer to be able to withdraw from the contract after a specified number of days if they cannot be approved for a mortgage.

  • APPRAISAL -- An appraisal is a third party independent professional opinion as to the value of a home.  Every lender requires an appraisal to be completed before they will proceed with lending money.  The mortgage lender bases their lending decision upon the appraisal number and will only loan up to the amount of the appraisal or the sales price, whichever is lower.

What happens if an appraisal comes in lower than the sales price? There are several options for the buyer:

  1. Buyer can proceed with purchase regardless of appraisal value.  The buyer will have to bring extra cash to the table to be able to buy the house.

  2. Buyer can ask the seller to lower the sales price to the appraised value and seller can agree to do so.  More often than not, especially in a market with declining values, we see this option happening.

  3. Buyer and seller can negotiate a sales price somewhere in between the previously agreed upon sales price and the appraisal amount.  This too happens regularly.

  4. If the buyer asks the seller to lower the agreed upon sales price and the seller flat out refuses, the buyer can void the contract.






  • Home Sweet HomeSALE OF HOME -- If you are buying a home, but first need to sell your home, you'll need to use the Sale of Home contingency.  This provides you with an out from the contract for the new home if your current home does not sell.

    On the flip side, if you are the seller, you may have a "choice of home" contingency so that until you find your new home, you may not be held liable to consummate the sale of your home.



With contingencies, there's always the chance that a sale will fall through.  When searching the MLS, you'll see contingencies marked as CNTG/KO, or CNTG/NO KO -- kickout versus no kickout.  That's a discussion for another day and another blog post.

When it comes to contingencies and your rights and obligations under a contingent contract, it is advisable to discuss the implications with an informed real estate professional and/or a real estate attorney.

Oooh... I happen to be both. :)


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Comment balloon 21 commentsBrian Block • August 26 2009 04:20PM


Fabulous.  Some of the contract language is so convoluted, agents really need to explain these contingencies to the buyer/seller carefully.


Posted by Lenn Harley, Real Estate Broker - Virginia & Maryland (Lenn Harley,, MD & VA Homes and Real Estate) almost 9 years ago

It is a good post and worthy subject of discussion since buyers really don't know about all the nuances of contingencies.

Posted by Margaret Goss, Chicago's North Shore & Winnetka Real Estate (Baird & Warner Real Estate) almost 9 years ago


Great post,  congratulations on the feature.  The title caught my eye and dragged me in.  I wasn't sure if you were trying to sell all of Northern Virginia?  Many of the contracts we use need explanations for the buyer and again for the seller.  It is our job to explain those contingencies so everyone is on the same page.

Posted by Carol Pease, CRS, Broker-Associate 512-721-6320 (JP & Associates Realtors) almost 9 years ago

Brian I think we spoke on the phone once when my offices were still with Allegiance.  Your posts are always informative and well written. 

Posted by Damon Gettier, Broker/Owner ABRM, GRI, CDPE (Damon Gettier & Associates, REALTORS- Roanoke Va Short Sale Expert) almost 9 years ago

Brain - This is an excellent break down and explanation of the different types of contingencies.  Congrats on the feature!

Posted by Michelle Gibson, REALTOR (Hansen Real Estate Group Inc. ) almost 9 years ago

Congratulations - what a nice easy-to-understand explanation of contingencies!  Great job!!

Posted by Nancy Conner, Olympia/Thurston County WA (Managing Broker - City Realty Inc) almost 9 years ago

Great explanation.  The "choice of home" contingency is a new one to me, don't have such a thing on our standard forms.

Posted by Joseph "Cathan" Potter (Coldwell Banker) almost 9 years ago

Um, I like the home inspection part!

Posted by Jay Markanich, Home Inspector - servicing all Northern Virginia (Jay Markanich Real Estate Inspections, LLC) almost 9 years ago

As da man!  Hey Brian...geez...we better start emailing hello's...hard to find each other nowadays :)

Posted by Celeste "SALLY" Cheeseman, (RA) AHWD CRS ePRO OAHU HAWAII REAL ESTATE (Century 21 Liberty Homes) almost 9 years ago

Right now here in Michigan they aren't taking many home sale contingencies.

Posted by Russ Ravary ~ Metro Detroit Realtor call (248) 310-6239, Michigan homes for sale ~ (Real Estate One) almost 9 years ago


This is right on time. It can all be very confusing. I was just explaining the various contingencies yesterday, as well as the Kickout/No Kickout. Thanks for the great post.


Posted by Renee Thompson (Premier Sotheby's International Realty) almost 9 years ago

Hi Brian~ How convenient for your clients that you are both a informed real estate professional and a real estate attorney!  I think it is great.  Thanks for sharing all of these contingencies with us and the consumers!

Posted by Vickie McCartney, Broker, Real Estate Agent Owensboro KY (Maverick Realty) almost 9 years ago

Brian, it's amazing some of the contingencies that are so far outside what the boiler plate contemplates.

REally good post!

Posted by Patricia Kennedy, Home in the Capital (RLAH Real Estate) almost 9 years ago

Hi Brian -- Excellent advise, especially since you are a real estate attorney as well.  Your clients are well served with your background.

Posted by Chris Olsen, Broker Owner Cleveland Ohio Real Estate (Olsen Ziegler Realty) almost 9 years ago

A nice, clear, concise explanation of a very important concept in real estate contracts.

Posted by Christine Donovan, Broker/Attorney 714-319-9751 DRE01267479 - Costa M (Donovan Blatt Realty) almost 9 years ago


We can always count on you for great yet clear explanations.  Can't tell you the number of times I've had to explain to agents that Subject to third party approval (short sale) is also a contingency. Many erroneously think it isn't a contract prior to bank approval of the offer...

Posted by Irene Kennedy Realtor® in Northwestern NJ (Weichert) almost 9 years ago

That last one is a big one. I recently had a sale bust that was not contigent upon the buyers home selling. We pointedly asked if the buyers could perform, and the realtor said yes, and the pre-approval said yes. 4 days before closing they asked for a 1 month extension becasue they needed to sell or lease their house. No clause can protect the seller here. Now we are asking for the earnest money to be forfeited to the seller, but that can't make up for 45 days lost in marketing, and now school has started. Doesn't happen often but it does put a premium on that world, trust. 

Posted by Joe Pryor, REALTOR® - Oklahoma Investment Properties (The Virtual Real Estate Team) almost 9 years ago

ha.....great information here.  Thanks for getting it out to us on AR today

Patricia Aulson/portsmouth nh homes

Posted by Patricia Aulson, Realtor - Portsmouth NH Homes-Hampton NH Homes (BERKSHIRE HATHAWAY HOME SERVICES Verani Realty NH Real Estate ) almost 9 years ago

All states are a bit different but very interesting on how they handle all these maybes.

Posted by Kathleen Lordbock, Keller Williams Realty Professionals (Keller Williams Realty Professionals) almost 9 years ago

Brian - there are so many contingencies that are confusing to both buyers and sellers...this is a great breakdown on the major ones.

Posted by Sonja Adams (Samson Proprties) almost 9 years ago

Brian this is really good post!  Easy on the eyes to read and easy for clients to understand.

Posted by Anna Banana Kruchten CRB, CRS, Broker, Arizona's Top Banana of Real Estate! (Phoenix Property Shoppe) almost 9 years ago