Dear Monty: We are selling our home to a neighbor down the street. We didn’t know them, but they knocked on our door a month ago and asked if we would be interested in selling. We got several opinions from agents and decided we could do this on our own. We have now agreed on a price, and I agreed to write up our agreement. They want a home inspection, which is a good idea. They will be paying for it. Do you have any tips on what else to include besides the fact that they will pay for it?
Monty’s Answer: Contingencies are frequent in real estate transactions. Due diligence costs are often expensive, and each party wants the basic terms in place before ordering work. Every property is unique and both parties have different life experiences, so they may have different expectations of the desired results. A contract that contains a contingency is not enforceable until the contingency is satisfied. The words “not enforceable” are why being as specific as possible when drafting a contingency is essential.
