Protect Your Rights Under the Financing Contingency

Step 3 in Edy’s series The Escrow Process for Buyers is the Financing Contingency deadline.

When we submit an offer on a property, the Buyer will tell the Seller how he plans to pay for the purchase.  Usually that would be through a lender.  If it’s not a cash purchase, we like to put a Financing Contingency onto the offer contract.  It specifies that if you are unable to get the loan after a good faith effort, and you can show that you met all the conditions you promised in the Finaincing Contingency, the Seller is directed to return your earnest money.

It’s important to pay attention to the deadline in order to protect your rights to get the earnest money returned.  If Buyer is financing the purchase  you must be sure to  apply to the lender IN WRITING within 5 days of mutual acceptance to retain your rights under the financing contingency. 

I should mention that all forms and contracts mentioned in this blog are the standard Northwest Multiple Listing Service forms which constitute almost all contracts used, unless you’re subject to a special Builder’s required contract or bank-owned required contract which can differ.  Ask me if you want more info on this.

Edy Kizaki, Broker, Realtor, edy@seattlecentric.com, 206-249-2914.