This week I will discuss the Closing Contingency contained in Paragraph 16 B. Closing Contingency means that your buyer wants to make an offer on a house contingent on the closing of their current house. Their current house must already be under contract and all contingencies except financing removed or waived, meaning the buyer must have completed the due diligence period and negotiated any and all repairs on the sale of their house. Otherwise, the offer is a Sale and Close contingency.
The Seller can continue to market the property but all other offers can only be negotiated as a back-up contract.
Should the buyer’s current house not close by the date entered in Paragraph 16 then the buyer may cancel the contract and is entitled to a return of the earnest money.
The date section in this paragraph continues to be confusing. Some agents use the date the due diligence period ends and others use the closing date of that property. The proper date should be the closing date of the buyer’s current house. In order to be a Close Contingency the due diligence period must already be completed. Therefore, it does not make sense to use the date the due diligence period expires because it should have already been removed or waived in order to use this contingency. The CCRA contract committee continues to work on revising this language.
* The Contract referred to in this Item is the Central Carolina Realtors Association contract that is widely used in the Midlands of South Carolina.